India's FY15 gold imports surge 19.5% to $34.32 billion

India's gold imports surged 19.5 per cent to $34.32 billion in the 2014-15 financial year that ended 31 March, as lower prices and an easing of import restrictions prompted stockists and jewellers to stock up the yellow metal.

Rising gold imports have pushed the country's trade deficit to levels around $137 billion in 2014-15. Gold imports in March, the last month of the 2014-15 fiscal, has doubled to $4.98 billion, which pushed the trade deficit to a four-month high of $11.79 billion, commerce ministry data showed.

India's gold imports stood at $28.7 billion in the previous fiscal ended 31 March 2014.

However, despite rising gold imports and higher trade deficit, Reserve Bank data show that the country's current account deficit has narrowed to 1.7 per cent for the first nine months of fiscal 2014-15 (April-December) while CAD for April-December in fiscal 2013-14 stood at $31.1 billion or 2.3 per cent of GDP.

India is the largest importer and consumer of gold and imports mainly cater to the demand of the jewellery industry.

RBI scrapped the controversial 80:20 scheme, which had restricted gold imports to the importer's ability to export, on 28 November last year and the RBI and the government have been maintaining that the CAD level was comfortable, but the spike in gold imports may spark fresh worries.