Gold, silver imports more than double in last four years.

New Delhi: Imports of gold and silver have soared to USD 61.5 billion in 2011-12, from USD 22.8 billion in 2008-09, the government said on Tuesday.

"The value of imports of gold and silver was USD 22.8 billion in 2008-09, USD 29.6 billion in 2009-10, USD 42.5 billion in 2010-11 and USD 61.5 billion in 2011-12," Minister of State for Finance Namo Narain Meena said in a written reply to the Rajya Sabha.

As per the World Gold Council, India is the largest consumer of gold in the world followed by China, he added.

"As far as gold and silver are concerned, India is a net importer and the prices of these precious metals depend on international prices. The volatility in the prices of gold and silver in India is mainly due to the volatility in the prices of these commodities in the international markets," he said.

The current account deficit (CAD), which arises when import of goods and services exceeds export, had touched 4 percent at the end of December 2011. It was 3.3 percent during the same period of previous year.

The increase in CAD was mainly on account of higher imports of petroleum products and gold and silver.

In a separate reply, Meena said to lower the impact of gold import on CAD, the government in Budget for 2012-13 has proposed to increase basic customs duty on standard gold bars, gold coins of purity exceeding 99.5 percent and platinum from 2 percent to 4 percent.

Besides, customs duty on non-standard gold was increased to 10 percent from 5 percent.

He said the Reserve Bank has taken certain prudential measures in respect of Non-banking financial companies (NBFCs) which are engaged in lending against gold jewellery to restrict loans against gold.

Source : zeenews.india.com