Gold imports more than halved to $6.08 billion in the first five months of 2016-17, which is expected to keep a lid on the current account deficit. The sliding prices of the precious metal in global and domestic markets are seen to be at work. Gold imports stood at $15.42 billion in April-August of 2015. The in-bound shipments contracted for the seventh straight month in August by 77.45 per cent to $1.11 billion, according to commerce ministry data.
The contraction in imports helped narrow trade deficit to $7.67 billion in August 2016, the lowest in three months, as against $12.34 billion in August 2015. India is one of the largest gold importers in the world and the imports mainly take care of demand of the jewellery industry. For the full year, CAD stood at $22.1 billion, 1.1 per cent of GDP, as against $26.8 billion, 1.3 per cent, in 2014-15. As per the data, silver imports too went down to $130.32 million in the month under review as against $363.41 million in the same month last year.
In volume terms, the country's total official gold imports declined to 60 tonnes in April-July of this fiscal, much lower than 250 tonnes in the year-ago period. India, the world's second-biggest gold consumer after China, imported 650 tonnes in 2015-16.