Good news for the price of gold:
"Gold demand in India to rise, Modi seen easing import curbs
By Siddesh Mayenkar and A. Ananthalakshmi
MUMBAI/SINGAPORE Tue May 20, 2014 3:22pm IST
(Reuters) – India’s gold demand is likely to pick up in the second half of the year as curbs on bullion imports are expected to be eased by the country’s new government, the World Gold Council (WGC) and other industry officials said on Tuesday.
Gold imports by India, the world’s No. 2 bullion consumer after China, could double from current levels if the restrictions are eased, according to an industry estimate. This would help global prices that slumped 28 percent last year – the first drop in 13 years – partly due to India’s curbs.
Struggling with a ballooning trade deficit, India in 2013 imposed a record high duty of 10 percent on overseas purchases of gold, the second-biggest expense in its import bill, and introduced a rule tying import quantities to export levels.
"The change (in gold policy) is inevitable because Modi seems to be pro-gold," said Albert Cheng, WGC’s head of the far east region, referring to Narendra Modi who romped to a landslide victory in the recently concluded general elections in India. "It’s just a matter of when he is going to do it."
Modi, who leads the pro-business Bharatiya Janata Party, has said any action on gold should take into account the interests of the public and traders, not just economics and policy.
AI
