The Reserve Bank of India (RBI) has extended the
restrictions on gold import to other agencies in addition to banks, a moved aimed at curtailing demand for the precious metal for domestic use amid widening current account deficit.
The restrictions will, however, not apply to import of gold to meet the needs of exporters of gold jewellery.
On May 13, such restrictions
were put on banks.
"It has now been decided to extend the provisions (of May 13 circular) to all nominated agencies/ premier / star trading houses...accordingly, any import of gold on consignment basis by both nominated agencies and banks shall now be permissible only to meet the
needs of exporters of gold jewellery," the central bank said, adding the restrictions are applicable with immediate effect.
RBI also said all Letters of Credit (LC) to be opened by nominated banks and agencies for import of gold "under all categories will be only on 100 per cent cash margin basis".
Further, it said, all imports of gold will necessarily have to be on "Documents against Payment (DP)" basis as the imports on "Documents against Acceptance (DA)" will not be permitted.
The government and RBI have been taking steps to reduce gold imports, which has
contributed to a widening current account deficit (CAD). CAD hit a record high of 6.7 per cent of GDP in the third quarter of 2012-13.
The import of the yellow metal during the first two months of the current financial year are estimated at $15 billion.
Gold imports by India, the world's largest consumer, stood at 860 tonnes in 2012.
With inputs from PTI
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