- Imports said to fall 88 percent year-on-year to about 16 tons
- Jewelers shut shops during March to protest tax policy change
Gold imports by India, which vies with China as the biggest consumer of the metal, slumped 88 percent last month as a strike by jewelers curbed purchases, a person familiar with provisional Finance Ministry data said.
Inbound shipments declined to about 16 metric tons in March versus 133 tons a year earlier and 35 tons in February 2016, the person said, asking not to be identified as the data isn’t public. For the year ended March, India imported about 894 tons worth 1.88 trillion rupees ($28 billion), down from about 1,133 tons or 2.67 trillion rupees in the prior fiscal year, the person said.
Global gold prices have climbed about 15 percent in 2016 as investors sought protection from stock market turbulence. The higher cost of the metal, and the strike by domestic jewelers protesting against an excise tax, weighed on Indian purchases.
"The demand we lost in the first quarter will be made up in this quarter as we have festivals and weddings coming up," said Rajesh Mehta, chairman of Bangalore-based Rajesh Exports Ltd. "There’s quite a bit of latent demand."
Finance Ministry spokesman D. S. Malik declined to comment.
Bullion is bought during festivals and marriages as part of the bridal trousseau or gifted in the form of jewelry by relatives. Domestic demand was 848.9 tons in 2015, World Gold Council data show. The nation imports almost all the gold it consumes.