Trade experts said softening prices of the yellow metal in the global markets could be the reason for the contraction in the value of imports.
The country’s gold imports dipped about 3 per cent in value terms to $32.8 billion during 2018-19, which is expected to keep a lid on the current account deficit. Total imports of the precious metal in 2017-18 had stood at $33.7 billion, according to data from the commerce ministry.
Trade experts said softening prices of the yellow metal in the global markets could be the reason for the contraction in the value of imports.
After recording negative growth in February, the imports grew 31.22 per cent to $3.27 per cent in March.
India is one of the largest gold importers in the world, and the imports mainly take care of demand from the jewellery industry.
Jump in imports during March helped gems and jewellery exporters push their exports. The outbound shipments dipped only marginally by 0.37 per cent to $3.42 billion in March.
The country’s current account deficit (CAD), or the difference between outflow and inflow of foreign exchange in the current account, widened to 2.5 per cent of gross domestic product (GDP) in the third quarter of the fiscal, against 2.1 per cent in the year-ago period, mainly due to a large trade deficit.
The government had introduced several measures to restrict the import of gold. Import of the yellow metal attracts 10 per cent duty.
The domestic jewellery industry always demands a cut in the duty and relaxation of other import norms for increasing availability of the yellow metal to boost jewellery exports.
