NEW DELHI, July 16 (Agencies): Gold imports fell by 25 per cent to USD 8.43 billion in the first quarter of the current fiscal due to sliding prices of the metal in both global and domestic markets.
According to the commerce ministry data, gold imports had amounted to USD 11.26 billion in the corresponding quarter of last financial year, 2017-18.
The imports of the metal have been declining since January this year.
Contraction in gold imports help contain the current account deficit (CAD).
CAD, which is the difference between the inflow and outflow of foreign exchange, jumped to USD 48.7 billion, or 1.9 per cent of GDP, in 2017-18 fiscal.
This was higher than USD 14.4 billion, or 0.6 per cent, CAD in 2016-17 fiscal.
With rising oil prices, depreciating rupee and outflow of portfolio investments, there are concerns that CAD might rise in the current fiscal.
Rise in crude oil prices and imports too have impacted the trade deficit, which widened to $44.94 billion during April-June this fiscal as against USD 40 billion in the same period of 2017-18.
Meanwhile, gold steadied on Monday as the dollar slipped, but higher interest rates in the United States weighing on investor demand and a weak physical market are expected to pressure prices of the precious metal.
Spot gold was up 0.2 per cent at $1,244.13 an ounce at 0921 GMT, after marking the lowest since Dec. 12 at $1,236.58 on Friday.
US gold futures were 0.2 per cent higher at $1,244.2 an ounce.
A lower US currency makes dollar-denominated gold cheaper for holders of other currencies, which could boost demand.
The Federal Reserve last month raised its benchmark overnight lending rate 25 basis points to 1.75-2.0 per cent. Expectations are for another two rate rises this year and three in 2019.
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