India’s gold imports, which has a bearing on the country’s current account deficit (CAD), more than doubled to USD 38 billion during April-December this fiscal on account of higher demand, according to data of the commerce ministry. The imports stood at USD 16.78 billion in April-December 2020.
In December 2021, imports of the precious metal rose to USD 4.8 billion from USD 4.5 billion in the year-ago period. The surge in gold imports during the nine months contributed to the widening of the trade deficit to USD 142.44 billion against USD 61.38 billion in April-December 2020.
Similarly, silver imports also increased to USD 2 billion during April-December 2021 from USD 762 million in the same period of the previous fiscal.
India is the world’s second-biggest gold consumer after China. The imports mainly take care of the demand by the jewellery industry. The gems and jewellery exports during the nine-month of the current fiscal grew by 71 per cent to about USD 29 million.
India’s current account slipped into a deficit of USD 9.6 billion or 1.3 per cent of GDP in the September quarter, according to the Reserve Bank.
The current account, which records the value of exports and imports of goods and services, along with international transfers of capital, was in a surplus mode both in the quarter-ago and year-ago periods.