MUMBAI Gold jewellery exports from India rose for a third consecutive month in April as raw material supplies improved after the Reserve Bank of India (RBI) allowed more banks to import bullion.
Struggling with a ballooning trade deficit, India last year imposed a record duty of 10 percent on overseas purchases of gold, the second-biggest expense in its import bill. That hit gold jewellery exports, with shipments in the fiscal year that ended in March dropping around 40 percent.
But jewellery exports in April continued to build on a firm trend, registering a 14.69 percent rise to $604.42 million, the Gems and Jewellery Export Promotion Council said in a statement.
"Supply condition has improved a little bit...if supplies improve more, exports will grow further," said Rajiv Jain, past chairman of the council.
India imported 50 tonnes of gold in March, which acted as a buffer for the following months, Jain said, when the country witnessed lower imports due to restrictions imposed on cash due to elections. India imported 30 tonnes of gold in April.
Total gems and jewellery exports fell 6.8 percent to $2.5 billion.
The amount of gold jewellery shipped by India is directly related to its imports after the country enforced the so-called 80/20 rule in July, making it mandatory to export a fifth of all gold imports.
Meanwhile, the RBI has indicated that it aims for a slow and steady removal of restrictions as the current account deficit comes under control.
Silver jewellery exports unexpectedly fell 36.85 percent to $111.12 million in April, after displaying a strong trend last year.
(Reporting by Siddesh Mayenkar; Editing by Matt Driskill)
Trending On Reuters
State Bank of India (SBI) reported its sharpest quarterly profit drop in five years on Friday but cheered investors by saying that fewer than feared of its loans risked turning sour. Read