Gold imports set to resume after procedural clarity

RBI had first issued norms mandating 20% of imported gold to be supplied to exporters

With commerce and finance ministries officials agreeing to remove all procedural hurdles for providing gold to exporters, imports are set to resume soon.

Around five tonnes of gold, lying with the customs due to procedural hurdles could also be released after the  officials concerned receive orders, which will be issued  very soon.

Imports were virtually on hold for almost two months when the Reserve Bank of India (RBI) first issued norms mandating 20 per cent of the imported gold to be supplied to the exporters. In the last two months, barely 10-15 tonnes have arrived in the country through the official route.

In a meeting in Delhi on Friday, which was attended by senior officials of the ministries of finance and commerce, the Central Board of Excise and Customs (CBEC) and the Directorate General of Foreign Trade (DGFT), along with all gold importing banks, the decision was taken that customs officials across the country will be issued orders soon to release gold to exporters based on one-time certificate holders.

Pankaj Parekh, vice-chairman, Gems and Jewellery Export Promotion Council (GJEPC), present in the meeting, said “Now, exporters should get the gold they want as all the issued have been sorted out. Even after this if any exporters have any issue, government has appointed 4 nodal officers to sort out their problems immediately.”

However, in the first six months of the financial year so far, around 400 tonnes of gold have been imported and with the rule to compulsorily supply 20 per cent of the imported gold to exporters, in the next six months, the total net gold import could be maximum 200-250 tonnes, according to most optimistic industry estimates.  

The gold imports policy saw several amendments in two months from RBI and the customs department and now exporters, who had faced cancellation of orders for want of gold hope they will get the gold.

This will also solve issue of scarcity of gold in domestic market as till exporters procedural hurdles were not cleared banks were not able to import gold for the domestic market also.

Banks and other importers had halted imports as there was no clarity on how the rule would be implemented. The resulting impasse over imports crimped supply and pushed up domestic prices by higher premiums for physical delivery.