In a concerted effort at managing the current account deficit and defending the rupee, the government and the Reserve Bank of India (RBI) stepped in with further measures on Wednesday. While the RBI clamped down on capital outflow with tighter investment and remittance limits abroad for companies and individuals, the government banned import of gold coins and medallions.
Ban
The ban comes even as gold imports rose to 47.6 tonnes in July, up from 31 tonnes in June.
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Coins and bars comprised 36 per cent of the total gold import in 2012.
The RBI has reduced the limit for overseas investment through the automatic route by an Indian company by a third, from 400 to 100 per cent of its net worth.
In the case of individuals, the limit under the liberalised remittance scheme (LRS) has now been brought down to $75,000 a year from $200,000 even as they have been banned from using the LRS for acquiring immovable property abroad.
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Meanwhile, headline inflation rebounded to 5.79 per cent in July from 4.86 per cent in June.