Gold imports decline 39% to $1.47 bn in May

The Dollar Business Bureau

India’s gold imports have declined 39.14% at $1.47 billion in May 2016 against $2.42 billion in the same month previous year as per the foreign trade data released by Ministry of Commerce and Industry on Wednesday.

This is the fourth consecutive month that the imports of the precious metal have come down. It is mainly due to the downward trend in gold prices in domestic and international markets. The shrinkage of the inward shipment of gold has made trade deficit to decrease at $6.27 billion in May 2016 when compared to $10.4 billion in the corresponding period last year.

India is the leading gold importer globally. It imports mostly to cater to the jewellery industry’s demand. The decline in gold imports would impact on the current account deficit (CAD) of the country. Due to lower trade deficit, the CAD has reduced to 1.3% of the gross domestic product (GDP) during the third quarter of FY 2015-16 when compared to 1.5% in the corresponding quarter of FY 2014-15.