Ahmedabad: Thanks to rising gold prices and poor demand for jewellery, imports of the yellow metal took a major hit in August. According to estimates provided by the Ahmedabad Air Cargo Complex, gold imports in August stood at 0.64 metric tonnes (MT). This is a significant 70% decline in imports as against August 2016, when gold imports stood at 2.11 MT. Gold analysts and bullion traders say that duty-free imports from countries with which India has a Free Trade Agreement (FTA) and month-on-month increase in prices led to the decline in gold imports.
"It was expected that gold imports will decline owing to hefty duty-free imports from South Korea, which is helped by the FTA," said Haresh Acharya, the secretary of Bullion Federation. "The government's decision to restrict the import of precious metals was much needed and it will help improve the condition."
Industry insiders said that nearly 40 tonne gold was imported from South Korea in July and August, which was way more than the demand. At the same time, gold prices remained buoyant, touching the Rs 30,000 per 10 gram mark recently after a long time, said analysts.
In fact, gold imports in the state declined by 38% in August as against July this year. Jewellers also said that gold jewellery demand was low due to the lean season. "Prices went up and there was no major festival in the past month, so the demand for gold jewellery remained low," said a city-based jeweller.
However, analysts expect that imports will increase next month. "Festive season will begin in the third week of September and gold jewellery demand will shoot up on account of auspicious purchases and wedding orders," said Shanti Patel, the president of Gems and Jewellery Trade Council.
Source: timesofindia.indiatimes.com