Gold imports are likely to decline drastically this month as jewellers over-stocked the metal in anticipation more import restrictions, according to a trade body.
In the first half of December, gold imports were at 22 tonnes. In the previous month, gold imports stood at 151 tonnes, All India Gems and Jewellery Federation Chairman Haresh Chamanbhai Soni told PTI.
When RBI scrapped 80:20 norm on November 28, jewellers desisted from importing, expecting further relaxation.
About 20 tonne of gold had been imported in the October-December 2013.
“The surge in import in November was mainly driven by expectation of more restrictions by the Reserve Bank and not because of consumer demand. Till December 15, imports are at around 22 tonne and I don’t think there will be any more shipments,” Soni said.
The demand declined due to negative sentiments both globally as well as in the country, and the gold imported earlier was not yet consumed, he said, adding this brought down the premium charged by importers on gold to nil, he said.
When the RBI notification of November 28 scrapped the 80:20 scheme, the jewellers waited in anticipation of further relaxation before going for more imports, he added.
Under the 80:20 norm, at least 20 per cent of imported gold had to be exported in the form of jewellery. The relaxation came at a time when the industry was expecting more curbs on imports.
In January, Soni said, imports are likely to be quite low unless the government comes out with favourable policies, like bringing down the customs duty to 5 per cent from 10 per cent, and take steps to curb the grey market.
About the demand, he said, it would be less than expected, but slightly better than the last year.