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Govt liberalises import policy for gold, silver

The government has further liberalised the import policy for gold and silver.

This has been done to provide a fillip to the export of gold and jewellery, bring into legal channels the possible illegal financing of gold and silver, and a step to move towards capital account convertibility.

Under the new scheme, the import of gold and silver will be done through three channelising agencies -- STC, MMTC and HHEC -- and the eight banks already authorised by the Reserve Bank of India. These banks are the State Bank of India, Bank of India, Canara Bank, Indian Overseas Bank, Allahabad Bank, Bank of Nova Scotia, Standard Chartered Bank and ABN-Amro Bank.

Up to now, imports by these eleven agencies are only for exports. With the liberalisation, these agencies will now supply gold and silver for general sales in the domestic market as well.

The RBI may nominate other agencies to undertake such imports.

The rate of import duty under the new scheme will be Rs 220 per 10 gm for gold and Rs 500 per kg for silver. The duty will be payable in terms of rupees. There will not be any value addition norms for exports of gold and silver jewellery that is linked to imports of gold and silver through the new scheme.

However, value addition norms will continue to apply where exporters access gold and silver through the existing zero-duty facilities.

Payment of duty under the special import licences is presently required to be made from the exchange earners' foreign currency accounts. This requirement is being abolished and payments will now be accepted in rupees.

It may be recalled that the three windows were already available for the legal imports of gold and silver. These are imports by non-resident Indians, imports against special import licences, imports by nominated agencies and banks authorised by RBI only for zero-duty sales to jewellery exporters, NRIs and the special import licence holders.

UNI