RBI lifts ban on banks’ import of gold coins
19 Feb 2015 12:49 AM GMT
The Reserve Bank of India on Wednesday lifted the ban on imports of gold coins and medallions by banks and trading houses. The RBI in a notification also said banks are permitted to import gold on consignment basis. Domestic sales will be, however, permitted against upfront payment only.
“While the import of gold coins and medallions will no longer be prohibited, pending further review, the restrictions on banks in selling gold coins and medallions are not being removed,” it said.
The RBI and the government have been receiving requests for clarification on some of operational aspects of guidelines on import of gold after withdrawal of restrictions on import of the metal on November 28 last year, the notification said. Aiming to tame the then widening current account deficit (CAD), the central bank in August 2013 had prohibited imports of gold coins and medallions besides restricting inbound shipments of the metal. Under the 80:20 scheme, which was withdrawn on November 28 last year, gold imports were linked with its exports.
The notification further said the obligation to export under the scheme will continue to apply in respect of unutilised gold imported before November 28, 2014.
“Banks are free to grant gold metal loans,” it said, adding that Star and Premier Trading Houses (STH/PTH) can import the metal as per entitlement without any end use restrictions.
Gold imports surged by 8.13 per cent year-on-year to $1.55 billion in January on easing of restrictions by the RBI. India is the largest importer of gold, which is mainly utilised to meet the demand of jewellery industry.
“While the import of gold coins and medallions will no longer be prohibited, pending further review, the restrictions on banks in selling gold coins and medallions are not being removed,” it said.
The RBI and the government have been receiving requests for clarification on some of operational aspects of guidelines on import of gold after withdrawal of restrictions on import of the metal on November 28 last year, the notification said. Aiming to tame the then widening current account deficit (CAD), the central bank in August 2013 had prohibited imports of gold coins and medallions besides restricting inbound shipments of the metal. Under the 80:20 scheme, which was withdrawn on November 28 last year, gold imports were linked with its exports.
The notification further said the obligation to export under the scheme will continue to apply in respect of unutilised gold imported before November 28, 2014.
“Banks are free to grant gold metal loans,” it said, adding that Star and Premier Trading Houses (STH/PTH) can import the metal as per entitlement without any end use restrictions.
Gold imports surged by 8.13 per cent year-on-year to $1.55 billion in January on easing of restrictions by the RBI. India is the largest importer of gold, which is mainly utilised to meet the demand of jewellery industry.
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