Sunday 14 July 2013

Gold Imports Slip In June But Still Up 36% Yoy

Gold imports have slipped to 31 metric tonnes in June as per government data. It is 81 per cent less than the figures for May.



The numbers from the department of central excise and customs show they are, however, still 36 per cent more than the imports for the same month last year which means the upward thrust in the import demand for gold persists.




The numbers were shared with the chief economic advisor to the finance ministry Raghuram Rajan by the indirect tax department over the weekend.



Rajan also met foreign and domestic banks on Friday and would be meeting finance minister P Chidambaram on Monday to decide if the government needs to go ahead with a foreign bond issue to shore up the forex reserves. The minister returns from the US for a trip where he went to raise more forex for the economy.



An upsurge in the demand for gold along with oil has created the biggest macro economic management crisis for the centre for a long time. It has pushed the current account deficit to 4.8 per cent for the year 2012-13. Since this also creates a pressure on the foreign exchange by draining it the government has been looking for means to plug the leak and raise additional forex from international markets to finance it.



After meeting the bankers on Friday, Rajan had said all options (including raising of foreign bonds) were on the table.



Analysts are fretting that the government has run short of options to check in the falling rupee. While economists have said the fall is in sync with the economic fundamentals, treasurers of banks are fretting this is making it harder for them to meet the income targets of their banks.



The indirect tax data also shows that just in the first quarter of this financial year, gold imports at 335 tonnes is more than double the imports for last year at 137 metric tonnes. In value terms it is $15 billion against $7 billion in the same period last year.


Source:-www.indianexpress.com





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