Import of gold attracts basic customs duty which was increased on January 17, 2012
Gold imports declined to 398 tonnes during April-October of 2012-13 from 589 tonnes during the same period in the previous fiscal, the Parliament was informed today.
"The import of gold had declined from 589 tonnes in 2011-12 (April-October) to 398 tonnes in 2012-13 (April-October). In value terms, it has declined from Rs 1.40 lakh crore to Rs 1.15 lakh crore," the Minister of State for Finance S S Palanimanickam told Rajya Sabha in a written reply.
He said gold imports have declined during the first half of 2012-13, but trade deficit has increased marginally in this period due to increase in imports of other items.
However, he said there was no information available as to whether the increase in customs duty on gold had caused less demand from consumers.
Import of gold attracts basic customs duty which was increased on January 17, 2012 and again in the Union Budget 2012-13, the minister said.
Rising gold imports has caused trade imbalances as gold import has been jacking up trade deficit which in turn increases current account deficit (CAD).
Last year, India imported 969 tonne gold, which contributed to record current account deficit of 4.2% and the net gold import constituted 1.8-2.4% of GDP.
In a separate reply to the house, Minister of State for Finance Namo Narain Meena said the government has not fixed any target to reduce the CAD.
"However, government had taken a number of initiatives to boost exports and reduce imports to lower trade deficit and CAD. At a same time, steps have been taken to encourage capital flows to facilitate financing of CAD," Meena said.
The CAD stood at 4.2% in 2011-12, 2.7% in 2010-11 and 2.8% in 2009-10, he added further.
Gold prices rose marginally by 0.15% to Rs 31,226 per 10 grams in futures trade today as speculators created fresh positions.