Gold imports likely to dip by about 24% to 38 tonnes in June

Gold imports are estimated to fall by around 24% to about 38 tonnes in June following restrictions on imports and jeweller associations banning sale of coins and bars, an industry body said.

 

The country imported about 50 tonnes of gold in June 2012, according to official data.

 

CAD (current account deficit), which is the difference between the outflow and inflow of foreign currency, is estimated to be around 5% of the GDP in 2012-13 fiscal. CAD had touched a record high of 6.7% during October-December quarter.

 

The central bank had said the trade deficit has widened during April-May due to surge in festival related or seasonal gold imports.

 

To curb demand, the government hiked the import duty on gold three times in a year and raised it by 2% to 8%. Besides, RBI too has put restrictions on banks on importing gold.

 

Meanwhile, All India Gems & Jewellery Trade Federation (GJF) has taken steps to help curb gold imports by issuing a circular to its members requesting them to stop selling bars and coins.

 

"We have requested our members and affiliated members to help the government to reduce gold import by not selling bars and coins. We are getting positive response from our members and this step will help bringing down the imports to some extent," GJF Chairman Haresh Soni told PTI.

 

GJF has also submitted a representation to the Finance Ministry, which suggests at way in which imports can be curbed without jeopardising the jewellery industry, he said.

 

"We have listed number of ways that will help the government to curb imports. Our representation includes gold deposit scheme that will encourage people to deposit idle gold lying with them with the government in lieu of some interest for a few years. This gold then can be used for jewellery purpose by the industry and can later be given back to the source," Soni added.

 

He said there are about 25,000 tonne gold laying idle in the country and if 5-10% of it used the issue will be resolved. "The government has asked us to structure this gold deposit scheme. We are working on it and will present it this week," he added.