Indian Commerce Ministry hints at some respite on 'onerous' gold import norms

MUMBAI (Scrap Monster) : According to latest reports, the Indian Commerce Ministry has termed the recent restrictions on gold imports by the Reserve Bank of India (RBI) as ‘onerous’ and has suggested certain relaxations on the imports of the yellow metal to the benefit of exporters.

According to the revised circular with regard to import of gold by Nominated Banks/Agencies or entities, 20% of all imported gold through custom bonded warehouses must be held in there, which can be released to exporters against undertaking to customs. The second lot of gold imports is possible only after the quantity earmarked for exporter clients is released to the exporters against their undertaking to fulfill the export commitments within the stipulated time. The quantum of gold permitted to be imported in the third lot will be restricted to 5 times the quantum for which proof of export is submitted. For import of gold in the subsequent lots, the cycle may be repeated following the 20/80 principle.

As per the prevailing gold import rule, the exporters are able to import the next consignment of gold only upon submission of proof of export. The Commerce Ministry proposes to do away with the condition of providing proof of export before allowing import of next consignment. According to the Commerce Secretary S.R Rao, insisting for proof of exports may disrupt the cycle of manufacturing. The Commerce Ministry is believed to have written a letter to the Economic Affairs Secretary requesting for wavering of the ‘onerous’ norm for the exporters of gems and jewellery.