Friday, May 17th 03:33 PM IST

India Gold import drop may hit SA economy

# India gold reserves  # gold imports  # SA economy  

South Africa's total exports to India were valued at about $9 billion during the last financial year, about 56 percent of it comprised gold.

NEW DELHI(BullionStreet): India's anti gold measures were hitting South Africa, a major gold exporter, according to a top SA official.

Stefanus Botes, minister counsellor (Economic) in High Commission of South Africa in India, said his country could suffer from India's gold imports cuts as SA were one of the major suppliers of gold to India.

He said South Africa is aware of the steps that have been taken by the Indian government to slow down the imports of gold.

He added that since South Africa is a major supplier of gold into global markets and particularly to India, it will have an impact on it's economy, but have to comply with the rules and regulations of the importing country.

The South African diplomat was, however, hopeful that the share of the precious metal would remain high in the country's exports kitty to India in the coming years.

He however, think that the value of gold exports to India would be on the higher side in the years to come. Bilateral trade between the two countries stood at $14.7 billion during 2012-13.

South Africa's total exports to India were valued at about $9 billion during the last financial year, about 56 percent of it comprised gold.

India imported only 215 tons of gold in the first quarter this year compared with 228 tons in the same period last year.

The Indian government and the central bank have earlier also taken steps like hike in import duty to restrict gold imports.

With gold imports putting pressure on the current account deficit, the Reserve Bank of India has recently tightened the screws on imports of the yellow metal by restricting banks to import bullion on a consignment basis only to meet genuine needs of exporters of gold jewellery.

However, the demand for the yellow metal will continue to be robust in the coming months despite government efforts WGC said, while cautioning that any further supply controls will activate unauthorised channels.

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