India's gold imports are likely to come down to USD 38 billion from USD 53.8 billion this fiscal despite some demand pick up during the forthcoming festival season, Prime Minister's key economic advisor C Rangarajan said today.
The latest numbers for July and August indicate a sharp decline in the import of gold, the Chairman of Prime Minister's Economic Advisory Council (PMEAC) said.
However, the low import trend may reverse a little in the coming months because of festival season, he said.
"We do expect gold import to come down substantially during this year... with the present regulations...gold imports may come down to the level we have indicated that is USD 38 billion," he said.
The gold import, which totalled USD 53.8 billion in the last fiscal, is one of the major reasons for India's record high current account deficit (CAD) of USD 88.2 billion in 2012-13.
A concerned government raised customs duty on gold to 10 per cent and the RBI put in import restrictions on banks and other agencies in this regard to tackle the situation.
Rangarajan further said India really needed to ensure that the declining trend in gold import is maintained in the future as well.
The PMEAC has projected gold and silver imports at USD 40 billion this fiscal as against USD 55.8 billion shipped in last fiscal.
In April 2013, world gold prices fell sharply and the domestic demand for gold sky-rocketed, with imports nearly topping USD 16 billion (including silver) in first two months of the fiscal. But since then the imports have slowed.