Author: Paul Ploumis21 Oct 2014 Last updated at 08:28:45 GMT
MUMBAI (Scrap Monster): According to sources familiar with Reserve Bank of India (RBI) policies, the country’s central bank is not planning to reinstate the tough gold import norms. The proposal to tighten gold imports into the country is presently not under its consideration, said sources.
The Revenue Department under the Indian Finance Ministry had requested the Department of Economic Affairs (DEA) and the Reserve Bank of India (RBI) to review the relaxations granted on gold imports during May this year. This was after the country’s trade deficit ballooned to almost double during September, due to unprecedented rise in gold and silver imports. The gold imports during the month had more than doubled to 9 tonnes in September.
The RBI had relaxed some import curbs by allowing seven trading houses to import the yellow metal. The imports by the trading houses skyrocketed on account of huge demand anticipation during the ongoing festive season in the country. The Finance Ministry had warned the Central Bank that unless the restrictions are put back in place, the trade deficit figure for the upcoming months may worsen further.
The sources close to RBI stated that it will not change its gold import rules immediately.
Meanwhile, the Government has deferred its decision on the matter post Diwali. Mr.Arun Jaitely, Finance Minister said on Monday that the Central government would look at re-imposing the curbs after Diwali. Reportedly, Indian government has expressed deeply concerns over spiraling gold and silver imports.