To curb runaway rise in imports, Centre also clubs gold ETFs with gold deposit schemes
The government on Monday hiked the import duty on gold and platinum from 4 to 6 per cent with immediate effect in an urgent bid to curb imports of the precious metals and contain the widening current account deficit (CAD).
In a twin-policy remedial package aimed at checking the runaway rise in gold imports, which has been adversely impacting the CAD since last fiscal, the government also announced its decision to link the Gold ETFs (Exchange Traded Funds) with Gold Deposit schemes as a measure to increase the supply of physical gold in the market without resorting to imports.
“The government has decided to increase import duty on gold and platinum from 4 per cent to 6 per cent with immediate effect,” Department of Economic Affairs Secretary Arvind Mayaram said here.
The government, Dr. Mayaram said, would effect consequential changes in the additional customs duty and excise duty on gold ‘dore’ bars, gold ores and refined gold.
“The duties will be reviewed after some time if there is a moderation in the quantity of gold that is imported...,” he said.
Even as it will take some time to assess whether the bitter pill has yielded the desired results, the immediate fallout was an increase in the price of gold by Rs. 315 at Rs. 31,250 per 10 grams.
Keywords: gold import, current account deficit, import duty hike
Dear Mr.PC, You forget In India girl children are considered as a burden by parents mainly because of marriage espenses and gold is the main item parents shell out money. In Tamil Nadu even a rickshaw puller has to buy 10 sovereigns (80 g = Rs. 2.5 lakhs) to get his daughter married off. When your mandarin babus do not come out with practical tools to control CAD why to load additional burden on poor parents of girl children? Please dismiss the official who suggested you this step and bring in new talent near you preferably from middle class bkgd.
Father of 2 daughters
Increase everything, gov the initiator of first step in the process of increasing inflation
We have to wait and see whether the hike in the import duty and consequent price rise will be of any benefit either to the Government or the public.Considering the Indians'lust for gold and the way the demand has increased notwithstanding the price reaching sky high,robbers need not be worried of professional hazards to their snatch and run away business.can we see women wearing only flowers, and not jewels to avoid so many thefts/murders?In the existing price trend, we may not afford even to buy flowers.
This is very unhealthy move. UPA has become the real enemy of our nation. This is
an absurd move. If they want to prevent widening of current account deficit. Probably
they should have looked into areas where they can allow more exports and also have
long term vision to produce from the area of manufacturing rather than importing all
stupid things from other nations.
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