DURING APRIL-FEBURARY FY22
India’s gold imports, which have a bearing on the country’s current account deficit (CAD), surged by about 73 per cent to USD 45.1 billion during April-February this fiscal on account of higher demand, according to official data. The imports stood at USD 26.11 billion in April-February 2021.The surge in gold imports during the 11-month period contributed to the widening of the trade deficit to USD 176 billion.
In February 2022, however, imports of the precious metal dipped by 11.45 per cent to USD 4.7 billion, as per the data by the commerce ministry. The surge in gold imports during the 11-month period contributed to the widening of the trade deficit to USD 176 billion, against USD 89 billion in April-February 2021.
TRADE WIDENS IN FEBRUARY
“A rebound in oil and gold demand amid the waning of the third wave, along with rising global commodity prices fanned by escalating geopolitical tensions, boosted imports and bloated the merchandise trade deficit above $21 billion in February,” said ICRA chief economist Aditi Nayar.
As per the statement, merchandise exports in April-February FY22 were $374.05 billion, up 45.8% on-year while imports rose 59.21% to $550.12 billion.
“The trend so far has been quite impressive. Uncertainty has arisen in recent weeks on account of geopolitical situations involving Russia and Ukraine but its impact on engineering goods exports is yet to be assessed,” said EEPC India chairman Mahesh Desai.
Gold imports shrank 11.45% on-year but they nearly doubled sequentially in February, as curbs eased across the country.
“With monthly exports crossing the $30 billion mark for 11th consecutive time during the fiscal, we are on course to cross the $400 billion exports target for the fiscal,” said A Sakthivel, president, Federation of Indian Export Organisations (FIEO).
Non-oil, non-gold, silver and precious metals imports-a measure of the strength of domestic demand-were $31.61 billion in February, up 31.66% on-year
“Among the CIS countries, Russia is the biggest export market for Indian engineering goods. Exclusion of Russia from the SWIFT payment system would, therefore, mean delayed payment realisation for the exporters” Desai said
INDIA’s GOLD CONSUMPTION
Following China, India is the second biggest world consumer of gold. The imports mainly take care of the demand by the jewellery industry. The gems and jewellery exports during the first nine months of the current fiscal grew by 57.5 per cent to USD 35.25 billion.
India’s current account slipped into a deficit of USD 9.6 billion or 1.3 per cent of GDP in the September quarter, according to the Reserve Bank. The current account, which records the value of exports and imports of goods and services, along with international transfers of capital, was in surplus both in the quarter-ago and year-ago periods.
Commenting on rising gold imports, Gem, and Jewellery Export Promotion Council (GJEPC) Chairman Colin Shah said monthly average imports of gold during April-February 2022 are still at 76.57 tonnes, relatively lower than the usual level.
Gold imports in volume terms in April-February 2022 stood at 842.28 tonnes, which is below the usual imports in the same period, ranging from 690 to 890 tonnes, he said.
The Government is hopeful of topping the $400 billion export target for the current financial year despite the Ukraine crisis with exports during February grossed to around $34 Billion
Published By : VATSAL KOTHA
Edited By : KRITIKA KASHYAP
