Gold exports from India have halved in August to $561 million as compared to July. The imports are restricted by the government and RBI by levying huge import duty, the export of the yellow metal is directly affected.
The government has hiked import duty to 15% of late as a measure to restrict dollar outflow, which was burgeoning CAD and trade deficit. Owing to a major confusion over the new set of rules in import bill, gems and jewellery imports had almost stopped. Understandably, the bill states that 20% of all imports must be turned around and sold for export as jewellery.
Now, there is no clarity on how this rule shall be implemented. There shall be a meeting of government officials who shall define and throw more light upon how the rule shall be followed. Once there is a vindication by authorities, exports and imports shall return to their normalcy.
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