Following an “unusual" surge in imports of gold that pushed up India’s merchandise trade deficit to a record high in November, the commerce ministry is looking into the data on inbound shipments of this yellow metal along with the Central Board of Indirect Taxes and Customs (CBIC).
“On noticing unusual surge, DGCIS (Directorate General of Commercial Intelligence and Statistics) has taken up detailed examination of the gold import data and reconciliation would be done with the data received by CBIC,” according to sources in the commerce ministry.
India's merchandise trade deficit widened to a record high of $37.84 billion in November from $27.14 billion in the previous month due to a sharp rise in inbound shipments of gold, data released on December 16 showed.
Gold imports jumped to a record high of $14.86 billion in November 2024. This rise was seen as a fallout of a reduction in the custom duty to 6 percent from 15 percent in July.
Back then, the commerce ministry said asset diversification to gold due to factors like geopolitical uncertainties also led to the rise in imports.
Any reconciliation in the data for gold imports would be significant since it could lead to shrinking the historically high trade gap in goods for November.
The dismal trade deficit figures for the previous month did have a ripple effect with the Indian rupee touching an all-time low during the early hours of December 17.
To be sure, not just gold imports, but a fall in prices of petroleum products also weighed in on merchandise trade deficit evident from a drop of 49.69 percent on-year in outbound shipments of this item in the previous month.
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