Current gold import mechanism working well

Commerce Minister Anand Sharma, who is in Davos, said the current mechanism, which links gold imports to exports, is working well. However, he said the government was open to discussing all issues with the gems and jewellery federation.

The All India Gems and Jewellery Trade Federation wrote to Gandhi asking for a reduction in customs duty on gold to 2 per cent from the current 10 per cent. They also asked for relaxing the 80:20 rule imposed by India’s Reserve Bank, which disallows inward shipments of gold unless 20 per cent of the previous import is exported.

India's gold imports have slowed after the government hiked the customs duty to 10 per cent and imposed curbs on imports in a bid to reduce the current account deficit. Customs duty on gold was 4 per cent a year ago. India's gold and silver imports declined by 30.3 per cent to $27.3 billion during April-December, from a record $87.8 billion in the year ended March 2013.

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