Gold imports surge 8.13 per cent y-o-y to $1.55 billion in January

Gold imports surged by 8.13 per cent year-on-year to $1.55 billion in January on easing of restrictions by the Reserve Bank of India (RBI).

Imports of the precious metal stood at $1.44 billion in the same month in 2014.

Increase in gold imports impacts the current account deficit (CAD).

In December last year, imports grew by 7.39 per cent to $1.34 billion.

The RBI and the government have said that CAD levels are comfortable, but rise in gold imports may cause fresh worries to them.

On November 28 last year, the Reserve Bank of India had scrapped the controversial 80:20 scheme.

Under the scheme, put in place in August 2013 to curb high gold inflows that were widening the current account deficit, at least 20 per cent of the imported gold had to be mandatorily exported before bringing in new lots.

Contraction in exports and imports in January has helped trade deficit narrow marginally.

The trade gap aggregated at $ 8.32 billion during the month under review as against $ 9.45 billion in the same month last year.

CAD in the first half of this fiscal declined to 1.9 per cent of GDP ($18 billion) from 3.1 per cent ($27 billion) in the same period previous year.

India is the largest importer of gold, which is mainly utilised to meet the demand of jewellery industry.