Gold Import. In the Budget of February 2021, the import duty on gold was reduced. After this, the import of gold in the month of March has seen an increase of 470 percent. According to experts, the increase in gold import may increase the trade and the rupee may fall. According to the data, in the month of March, gold import has seen 160 tons.
Gold import increased due to these two reasons
The first reason for increasing gold import is that the government increased the gold import duty from 12.5 per cent to 10.75 per cent in the February budget. At the same time, there has been a decline in the price of gold. Due to which there has been a boom in the import of gold. Since August 2020, the price of gold has fallen by more than 20 percent so far. The price of gold reached Rs 56191 per ten grams in August. India is the second bumber country in the world to import gold.
How much increase over last year
On the other hand, in the quarter, the gold import in the March quarter was 321 tonnes, compared to 124 tonnes in the same period last year. If we talk in terms of value, then the import in March increased to 61.53 thousand crore rupees, which was slightly more than 9 thousand crore rupees a year ago.
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Trade deficit widens and rupee falls
The increase in gold imports has increased the possibilities of increasing India’s trade deficit. On the other hand, the rupee can be seen falling against the dollar. According to the information, the dollar basket is currently running at a 3-month high. An increase in imports may also affect India’s foreign capital reserves. The overall increase in imports of gold proves to be a loss-making deal for India.