MUMBAI(MCX BABA.COM): India Gold imports are set to decline further this month as jewellers had overstocked the yellow metal expecting more import curbs from the government.
All India Gems and Jewellery Federation said India jewellers imported only 22 tonnes of gold in the first half of December. This figure signals a slow down in shipment as the jewellers imported 151 tonnes of gold in November.
“The surge in import in November was mainly driven by expectation of more restrictions by the Reserve Bank and not because of consumer demand. Till December 15, imports are at around 22 tonne and I don’t think there will be any more shipments,” Haresh Chamanbhai Soni, All India Gems and Jewellery Federation Chairman, told PTI.
India had eased the restrictions on gold imports by withdrawing the 80:20 scheme in November end. The 80:20 rule is a law that obliges importers to re-export of their commodity shipments before the rest can be distributed in India for commercial use. The 80:20 rule was first launched in the country on August 2013.
Merchandise trade deficit widened $16.9 billion in November – an 18 month high. A year ago, trade deficit was under $10 billion. It was led by a surge in gold and core (non-oil non-gold imports) imports.
Surge in gold imports in November was perhaps led by higher demand spurred by the festive and upcoming wedding season and low prices (Rs 1,176/troy ounce vis-a-vis Rs 1,276/troy ounce a year ago).