With the World Gold Council estimating record gold imports of 300-400 tonnes in the three months ending June, the Government is planning to place more curbs on gold imports.
Finance Minister P. Chidambaram said that the gold import policy will be reviewed, if needed. “I think May gold imports have been about 162 tonnes. Obviously, India cannot afford to import about 162 tonnes a month,” he told reporters, after a meeting of the Financial Stability and Development Council (FSDC).
The issue of rising gold import was discussed in the meeting of the council, chaired by Chidambaram, and also in the sub-committee of the FSDC, which is headed by the RBI Governor D. Subbarao on Monday. It is estimated that the country will import between 850-900 tonnes in 2013, against 860 tonnes in 2012.
A statement issued by the Finance Ministry after the meeting said, “The Council noted with concern the significant increase in gold imports in recent months and deliberated on the issues involved.”
Economic Affairs Secretary Arvind Mayaram told reporters that more steps will have to be taken to reduce gold imports and the export-import policy on gold will have to be reviewed.
The options before the Government include raising import duty (currently at six per cent) and putting quantitative restrictions on imports.
It is believed that the Reserve Bank of India has written a letter to the Commerce Ministry requesting restriction of gold imports on consignment basis by state agencies such as STC and MMTC, and only allow imports to meet genuine needs of manufacturers and exporters, a Finance Ministry official said.