NEW DELHI (Scrap Monster): The trade data released yesterday is likely to encourage the newly elected government in India to act on high gold import duty structure. In a clear indication to this effect, senior government officials from Commerce Ministry stated that there is a need to relax the curbs on gold imports into the country in order to boost gold inflows and jewellery exports.

 

According to data, the country’s total exports during the month of May this year stood at $27.99 billion. The exports grew by 12.4% over the previous year, the highest in the past seven months. The exports of gems and jewellery recorded robust growth during the month. On the other hand, imports contracted by 11.41% year-on-year to $39.23 billion, mainly aided by lower gold imports. The gold imports in May ’14 plunged by 72% from $7.7 billion in May last year to $2.19 billion in May ‘14, whereas silver imports declined 37% over the year.

 

The Commerce Ministry expressed the hope that the rising trend in exports would sustain in forthcoming months as well. He termed the ‘double-digit growth’ in exports as encouraging, however the next month data need to be monitored before confirming it as ‘revival’.

 

Speaking to press reporters, Mr. Rajeev Kher,Commerce Secretary stated that the initial concerns of rising CAD has been addressed to some extent. This paves way for restoration or at least partial clampdown on high gold duties. He added that any policy action on lowering gold tax would happen only in the Budget which is to be presented next month.