New Delhi: India’s gold imports fell by 25% to $8.43 billion in April-June 2018-19 period due to sliding bullion rates in both global and domestic markets. According to the commerce ministry data, gold imports had amounted to $11.26 billion in April-June 2017-18. The imports of the metal have been declining since January this year. Silver imports grew by 104.5% to $364.24 million in June.
A contraction in gold imports helps contain India’s current account deficit (CAD).
India’s CAD, defined as the difference between the inflow and outflow of foreign exchange, jumped to $48.7 billion, or 1.9% of gross domestic product, in 2017-18. This was higher than $14.4 billion, or 0.6% of GDP, in 2016-17.
With rising oil prices, depreciating rupee and outflow of foreign portfolio investments, there are concerns that India’s current account deficit will rise in 2017-18.
Rise in crude oil prices and imports too have impacted the trade deficit, which widened to $44.94 billion during April-June this fiscal as against $40 billion in the same period of 2017-18.
India is the world’s largest importer of gold, which mainly caters to the demand of the jewellery industry. Gems and jewellery exports in June grew by about 3% to $3.5 billion. The country imports 700-800 tonnes of gold annually.