RBI relaxes gold curbs

MUMBAI/Hyderabad: The Reserve Bank of India on Friday relaxed import restrictions on gold after the government has decided to scrap its previous measure — called 80:20 scheme  to link the quantum of gold allowed to import to the value of gold or jewellery exports. “It has been decided by the government of India to withdraw the 80:20 scheme and restrictions placed on import of gold. Accordingly, all instructions issued about the scheme from time to time.. stand withdrawn with immediate effect,” the RBI said on Friday.

Under the 80:20 norms, 20 per cent of the imported gold had to be mandatorily exported by the purchaser before bringing in a new lot of gold.This measure has slow-ed down gold imports. However. it also lead to shortage of yellow metal and a resultant premium in India compared to the global price.The relaxation of gold curbs, experts feel, would allow easy imports, whi-ch could bring down premiums and lower the domestic price.

According to Pankaj Kumar Parekh, the vice chairman of the Gems and Jewellery Export Promotion Council (GJEPC), “the premium on domestic go-ld which is currently hovering around $16-$18 per ounce (Rs960 to Rs1,080) due to import restrictions, would come down to $2-$3 (120 to 180) per ounce after today’s decision."The easing of gold import norms could bri-ng down gold price by Rs330 to 370 per 10 grams.

“A lot of gold importers had started exporting gold ever since the government had introduced this 80:20 scheme. With  the scraping of this 80:20 scheme, such dummy ex-ports would stop,” added Mr Parekh.