Trade Deficit Widens As Gold Imports Log Multi Fold Jump In March
New Delhi: Recording a multi-fold jump, India's gold imports rose to $4.17 billion in March, which is expected to widen the current account deficit. Gold imports stood at $974 million in March last year, official data released on Thursday showed. Gold imports were on a decline since February 2016 till September 2016. They grew in October and November last year but again dipped in December 2016 and January 2017. In February, the inbound shipments grew to $3.48 billion from $1.4 billion in the corresponding period a year ago.
Surge in gold imports in March widened the trade deficit to a four-month high of $10.4 billion as against $4.4 billion in March 2016.
Silver imports, however, dipped 3.19 per cent to $204.2 million in March.
According to rating agency ICRA, the imports surge was led by restocking, as well as marriage and festive season demand.
India is the world's second biggest gold consumer after China. The imports mainly take care of demand from the jewellery industry.
In volume terms, India imported 560.32 tonnes of gold during April-January period of the last fiscal year.
Gold import aggregated to 968.06 tonnes in the entire fiscal year 2015-16 and 915.47 tonnes in 2014-15.
At present, gold import attracts 10 per cent duty. The gems and jewellery industry along with the Commerce Ministry have time and again urged the Finance Ministry to consider cut in the import duty.
For the full year 2015-16, current account deficit stood at $22.1 billion, or 1.1 per cent of GDP, as against $26.8 billion, or 1.3 per cent, in 2014-15.