Curb on gold imports to help contain CAD at $70 bn: Rangarajan

The current account deficit is likely to come down to $70 billion in the 2013-14 fiscal from a record high of $88.2 billion during the previous year, helped by curbs on gold imports, chairman of the Prime Minister's Economic Advisory Council C. Rangarajan said Monday.

"Reducing CAD from $88 billion to $70 billion is possible because of various actions taken by the government," Rangarajan said at an event organised by PHD Chamber of Commerce and Industry here.

"Gold imports falling by $10-12 billion itself will be a great relief," he said.

The government has recently sharply increased duties on gold with a view to curb imports.

Rangarajan said gold import is likely to come down to $43 billion in the current financial year from nearly $54 billion in the previous fiscal.

On growth, he said good monsoon is expected to push the economic growth to 5.5 percent in 2013-14 from five percent in the previous year.

"Even if India's investment and savings rates stay at the current level, and reformists policy decisions continue, the growth rate will pick up and sentiments for attracting FDI's will improve," Rangarajan, also a former governor of the Reserve Bank of India (RBI) said.

He said agriculture is estimated to register nearly 4 percent growth on the back of good monsoon, and manufacturing activities would pick up in the coming months.