The Conversation (0)
BullionStar’s Koos Jansen reported that preliminary data shows that India has already imported more than 130 tonnes of gold this month. Total gross imports for March could reach 150 tonnes, as per a “conservative estimate.”
BullionStar’s Koos Jansen reported that preliminary data shows that India has already imported more than 130 tonnes of gold this month. Total gross imports for March could reach 150 tonnes, as per a “conservative estimate.”
Explaining why imports are so strong, Jansen said:
Because of a ‘current account deficit’ the Indian government decided in March 2012 to raise to import duty on gold from 2 % to 4 %, in June 2013 from 4 % to 8% and in August 2013 from 8 % to 10 %. Additionally, in August 2013 the 80/20 rule was implemented, which was eventually withdrawn in December 2014.
The restrictions the Indian Government implemented on gold trade spawned new life to smuggling cartels with all due consequences. Official Import fell drastically, wiping out any revenues the government collected from the import of the yellow metal. In May 2013 Indian gross gold import accounted for 168 tonnes, by September 2013 a multi year low was reached at 15 tonnes. Premiums in India, over London spot prices, skyrocketed to a staggering 25 %.
