India likely to curb gold imports: MMTC source
India's passion for gold has led hefty imports which have contributed to a rise in its current account deficit.
New Delhi: India, the world's biggest gold importer, is likely to take more steps to curb purchases of bullion, a senior official with India's second-biggest gold importer, state-run MMTC Ltd, told reporters on Monday. India's passion for gold, seen by many as a hedge against persistently high inflation, has led hefty imports which have contributed to a rise in its current account deficit.
The deficit has reached an all-time high of 5.4 per cent of gross domestic product in the July-September quarter. In January, government raised the import tax on gold by 2 percentage points to 6 per cent.
State-run MMTC's gold imports in the fiscal year ending March 31, 2013 are likely to fall to 30-40 tonnes from 160 tonnes a year earlier, the official, who requested anonymity, said. The government will announce its budget for the year beginning April 1, 2013 on February 28 and if gold imports continue apace, traders have speculated New Delhi may take further action to curb demand.
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