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6 private banks allowed to import gold

gold(1)The Reserve Bank of India has allowed five private sector banks to import gold apparently intending to ease curbs on the imnport of the metal imposed last year to cut the country’s trade deficit. The move could boost gold supplies and bring down premiums for the metal in the country. RBI has allowed HDFC Bank, Axis Bank, Kotak Mahindra Bank, IndusInd Bank and Yes Bank to import gold. The government had enforced the 80/20 rule in July, making it mandatory to export a fifth of all gold imports. Under that rule, only six banks and three state-run trading agencies that had facilitated export of gold or jewellery in the past three years were allowed to import. The RBI has now permitted gold imports within prescribed limits by the private banks even though they had not facilitated any exports of metal or jewellery in the past three years. The move to allow more banks to import gold may raise shipments to about 40 tonnes per month from more than 20 in February, according to industry sources. India used to ship in as much 70 tonnes per month, the biggest import after oil that had pushed the current account deficit to a record high in the year ended March 2013.

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