Gold, silver imports dip 81% in November

Gold and silver imports declined 80.55 per cent to $1.05 billion in November after a slew of measures taken by the government to curb inbound shipments of the metal, aimed at narrowing the current account deficit.

Imports of gold and silver in November 2012 stood at $5.4 billion. Total merchandise imports last month also declined, helping to narrow the trade deficit to $9.21 billion, the second-lowest level in this financial year. It was at $6.76 billion in September.

“Overall trade deficit from April-November 2013 has come down by almost about $30 billion,” Commerce Secretary S R Rao said.

The trade deficit stood at $99.9 billion during the first eight months of this financial year compared with $129.2 billion in the same period last year.

The current account deficit (CAD) touched a historic high of 4.8 per cent of GDP in 2012-13 and was mainly attributed to high imports of gold and petroleum products. A high level of CAD puts pressure on the rupee, which has depreciated by about 15 per cent since April 30. During April-November 2013, gold and silver imports declined 23.78 per cent to $25.5 billion from $33.5 billion in the same period last year.

The government recently increased import duty for the third time in a year to 10 per cent from eight per cent and banned inward shipments of gold coins and medallions.

Further, the Reserve Bank of India restricted the import of gold on a consignment basis by banks. India is the largest importer of gold, which is mainly utilised to meet the demand of the jewellery industry. Imports stood at 830 tonnes in 2012-13.