NEW DELHI: Gold imports contracted for the fourth consecutive month in May by 39.14 per cent at USD 1.47 billion, which is expected to keep a lid on the country’s current account deficit.
The sliding prices of the precious metal in both global and domestic markets are seen as a contributory factor for the plunge. Gold imports stood at USD 2.42 billion in May 2015. The contraction in the imports helped narrow trade deficit to USD 6.27 billion last month. The deficit was at USD 10.4 billion in the year-ago period.
India is the largest importer of gold in the world and the imports mainly cater to the demand of the jewellery industry. India’s current account deficit (CAD) narrowed to 1.3 per cent of GDP in the third quarter of 2015-16 as against 1.5 per cent in the same period of the previous year, mainly on account of a lower trade deficit.
