Gold loses shine: Yellow metal import falls in FY19; key reasons

London (April 19)  In what may cap current account deficit, the gold imports fell by nearly three per cent in value terms FY19, data from the commerce ministry showed. The imports of the yellow metal dipped in value terms to $32.8 billion in the last fiscal as against $33.7 billion in FY18. The imports increased by 31.22 per cent to $3.27 billion in March after falling in February.

The reason behind narrowing down in the value of imports is softening of the prices of the yellow metal across the international markets. On account of large trade deficit, the current account deficit (CAD) increased to 2.5 per cent of the gross domestic product (GDP) in the third quarter of fiscal year 2019.

In the last few years, the government has come out with various measures to restrict the import of the gold. Higher number of gold imports has remained a reason behind escalated current account deficit of the country in the past many years.

At present, the import of gold attracts duty as high as 10 per cent. With an aim to increase the availability of the gold to support jewellery exports, the domestic jewellery industry always demands a cut in the duty and relaxation of other import norms.

Meanwhile, the prices of gold metal rose by Rs 305 to Rs 32,690 per 10 gram in Delhi today amid rise in buying by local jewellers, All India Sarafa Association data showed. Increase in buying from the local jewellers and the retailers boosted prices of gold metal today, traders told news agency PTI.

The prices of gold of 99.9 per cent and 99.5 per cent purities increased by Rs 305 each to Rs 32,690 and Rs 32,530 per 10 gram, respectively. The international gold market was closed today on account of ‘Good Friday’.

FinancialExpress