India Gold Imports Dipped 9% on Demand Slowdown

SEATTLE (Scrap Monster): The Indian Commerce Ministry data suggests substantial decline in the country’s gold imports. The imports of the yellow metal totalled $24.64 billion by value during the initial ten-month period (Apr ’19 to Jan ’20) of the current fiscal year. This is down by 9% over the imports of $27 billion during the corresponding period last fiscal.

The drop in gold imports has helped the country to trim its current account deficit (CAD) to $133.27 billion during this period. The CAD had totalled $163.27 billion during the year-ago period.

The imports have witnessed huge decline in recent times, especially due to slowdown in demand from jewellery manufacturers. The demand for gold jewellery in the country has been on a decline, mainly on account of record high domestic gold prices. The extremely high landing cost for gold in the country, due to high import duty and GST rates has resulted in shifting of jewellery manufacturing bases to neighbouring countries, where duty rates are quite favourable when matched with those in India.

The government had turned deaf ear to repeated pleas by industry participants for lower gold import duty, even in the most recent budget announced February 1, 2020.