Import duty on gold, platinum hiked to 6% in India as govt battles imports, CAD
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He said the advantage would be that a part of gold lying in stock would be brought in circulation and would practically meet the requirements of the gems and jewellery trade.
"It is hoped that, consequently, there will be a moderation in the quantity of gold that is imported into the country," he said.
India spent a whopping USD 56.5 billion on gold imports in 2011-12 and USD 38 billion in the first nine months of current fiscal.
The hike in duty may moderate demand in the world's largest bullion buyer that has seen prices jump 7.1 per cent in 2012.
Outflow of the foreign exchange on gold imports is impacting country's CAD, which has widened to USD 38.7 billion or 4.6 per cent of the GDP in the first half of the current fiscal.
About 80 per cent of the nation's current-account deficit, the broadest measure of trade, tracking goods, services and investment income, is due to gold imports, according to the Reserve Bank of India.