India’s Rising Gold Imports Due To Festivities May Surge Trade Deficit

New Delhi, Sept 14 (KNN) India’s trade deficit is likely to shoot up owing to the gold imports driven by festive buying.

India is the second biggest consumer of the precious metal has risen to the tune of 40 per cent in August 2023.

As per the provisional numbers of India's gold imports in India in August 2023, a person familiarly with the developments told Mint that on the condition of anonymity that India's gold imports grew to USD 4.9 billion, which stood at USD 3.5 billion in August 2022.

Indian government is set to announce overall trade deficit data on September 15, 2023 i.e. on Friday this week. According to Bloomberg survey of economists, India's trade deficit is expected at USD 21 billion.

A trade ministry spokesperson said August trade data is still being compiled and it would be premature to comment on the figures, while a Finance Ministry spokesperson couldn’t be reached on the mobile for comment, reported Mint.

Gold purchases usually pick up in the second half of the year during festivals, which culminate with Diwali in October or November, weddings and as an auspicious investment.

An expected rise in purchases during the festive months could help pare a drop in this year’s consumption, hit by elevated local prices and a slowdown in discretionary spending.  (KNN Bureau)