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RAPAPORT... India increased an import tax on gold jewelry to 15 percent from 10 percent in an effort to further reduce gold imports and in turn lower the country's current account deficit. In August, India raised the import tax on bullion to 10 percent from 8 percent but kept the gold jewelry tax unchanged.
Government measures taken in the past 18 months to contain gold imports have resulted in reduced imports, according to the State Bank of India (SBI). Gold imports declined to $650 million by value in August compared with $2.97 billion in July. India's gold imports so far this year have fallen to $21.9 billion by value compared with $53.8 billion one year ago, according to the bank.
India's current account deficit as a percentage of the gross domestic product (GDP) surged to 4.8 percent during its fiscal 2013, which ended on March 30. The country is attempting to lower the deficit to 3.8 percent of the GDP by April 1, 2014.
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