The craze for gold is increasing again, 470% surge in gold imports in March

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Gold import March: India is the world’s second largest importer of gold. Total gold imports stood at 160 tonnes in March.

In March 2021, gold imports jumped 471 percent over the previous year.

In the budget, the government had decided to cut import duty on gold by 5 percent. While presenting the budget on February 1, Finance Minister Nirmala Sitharaman had reduced the import duty from 12.5 percent to 7.5 percent. After that, there has been a significant boom in gold imports. According to a Reuters report, gold imports rose 471 percent in March 2021 over the previous year. Total imports stood at 160 tonnes.

India is the world’s second largest importer of gold. In August 2020, the gold rate reached $ 2072 an oz in the international market. Since then, it has recovered more than 17 percent. Experts say that increasing gold imports is not a good thing. India is already in trade deficit and this gap will increase further. Due to this, the pressure on the rupee will increase and in the coming days it may fall further against the dollar. India imported 321 tonnes of gold in the March quarter, compared to 124 tonnes in the same quarter last year.

Imported $ 8.4 billion gold

In March 2021, India imported gold worth a total of $ 8.4 billion. In March last year it was a mere $ 1.23 billion. In terms of value, it has risen by 580 per cent. This is the highest jump on monthly basis in the last decade (the highest since 2012-13). In the financial year 202-21, gold was imported for a total of $ 34.5 billion, of which only $ 27.7 billion was imported between October and March.

Current account deficit will increase

Experts say that the rapid increase in gold imports will increase the pressure on India’s current account deficit. India’s current account deficit reached 5.6% of GDP in 2012-13, with gold imports contributing a lot. Due to increasing deficit, the value of rupee falls. In the current year 2021, India’s current account is in the surplus of 25 billion dollars, but if the same pace is maintained then a change in the situation is possible.

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Bhagyashree Soni
Bhagyashree Soni
Bhagyashree Soni is a software engineer with soft writing skills. She is a degree holder from the International School of Entrepreneurial Leadership. She has been a state-level badminton champion and chess player. A woman with a forthright attitude enjoys her writing passion as her chosen career. Writing in the context of feminism, social-cause and entreprenurship is her forte.
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