Duty hiked on the import of Gold and Platinum
With an aim to curb the soaring CAD and depletion in the value of rupee, the government has raised the import duty on Gold and Platinum from previous 6% to 8%. The increase is targeted at discouraging import of gold, which is a key factor contributing in the rise in Current Account Deficit (CAD) affecting country’s foreign exchange reserves as well as the rupee value.
This is the second in the duty in six months as gold imports reached a worrying 162 tonnes in May 2013. In the last two months the imports of the metal has led to the outflow of 15 billion US dollars. The CAD, which is a difference between inflow and outflow of foreign currency, touched a historic high of 6.7% of GDP in the quarter ending December 2012.