The gold import of India increased 280 per cent to $4.1 billion in October 2014 compared to $1.09 billion in the same month last year following huge demand. This sharp rise is mainly because of big traders shipping in large quantities of the precious metal taking advantage of the relaxation in import rules brought about recently. Besides, marriage and festivals related demand also influenced the gold imports. Import of gold last month was to the tune of $3.75 billion, which was 450 per cent higher than gold imported in September 2014.
The BJP-led Government is now considering options to restrict import of gold, after the previous UPA Government relaxed rules just days before demitting office in May. Top officials of the Finance Ministry and the Reserve Bank of India met last week to discuss ways to impose control on imports, and are likely to meet again to take a decision on the matter.
The RBI had restricted import of gold to only nominated agencies subject to the condition that 20 per cent of the consignment would be exported under the 80:20 scheme in last July. However, the UPA government relaxed the scheme this May by allowing star and premier export houses to import it, thereby resulting in a sharp increase in imports.