Unusual Surge of Gold Imports, Commerce Ministry Confirms Reconciliation of Data to Be Done

After looking at the unusual surge in the gold import data in November, Directorate General of Commercial Intelligence and Statistics (DGCIS) will be taking up detailed examination of the data, confirms sources from the Ministry of Trade and Commerce.

It has further been confirmed by the sources that the department of the Ministry will do the reconciliation of the data within the next 10 days with the data received by Central Board of Indirect Taxes & Customs (CBIC).

"Reconciliation would be done within a week to 10 days with the data received by CBIC,” as per the sources in the Commerce Ministry.

Gold imports shot to an all time high in November, as it reached $14.86 billion, thereby registering a four-fold increase. During the trade data briefing on Monday, officials from the Ministry of Commerce stated that the surge in gold imports have happened in November due to festival and wedding demands. Gold imports stood at $3.44 billion in November 2023.

A day after the release of the latest trade data, Global Trade Research Initiative (GTRI) highlighted in its finding that there is an immediate need of actions to curb the gold imports as such sudden surge could threaten India’s trade balance and economic stability by weakening the rupee, and widening the current account deficit. Meanwhile, on Wednesday, Bloomberg reported citing sources that surge in gold imports that widened India’s trade deficit to a record high was due to an error in calculation. It is estimated that there could have been an over-estimation by as much as 50 tons in November or almost 30 per cent of total imports of the precious metal that month.

Gold imports in India have surged alarmingly, driven by multiple factors including growing investment demand, tariff reductions, and loopholes in trade agreements. For the first time, gold surpassed crude petroleum as India’s largest single import item.

Imports surged by 331.4 per cent in November 2024 compared to November 2023. Without gold, India’s merchandise imports would have grown by just 6.7 per cent instead of 27.04 per cent.