Gold imports down in fourth month

After sudden surge in gold imports in the second and third months of the current fiscal year, Nepal´s god imports in the fourth month declined by 38 percent, though the import volume was still higher than the volume recorded last year. According to statistics compiled by the Department of Customs, Nepal imported gold worth Rs 4.34 billion during the fourth month compared to Rs 2.59 billion recorded in the same period last year. The total import in the third month of the current fiscal year was worth Rs 7.02 billion.

Concerned experts said that higher imports made in the second and third months that altogether was much higher than the demand might have played a role in squeezing imports in the fourth month. "Higher imports during the first quarter of the current fiscal year made domestic market saturated, resulting in decline in imports afterward," said Tej Ranta Shakya, president of Nepal Gold and Silver Dealers´ Association.

Nepal´s total gold imports during the first four months of the current fiscal year has reached Rs 19.26 billion, more than the entire gold imports recorded during the last fiscal year. "Demand of gold had surged as it emerged as an alternative tool of speculative investment for those having relatively small investment portfolio, say less than one million, after recent slowdown in stock market," Shakya added.

However, some government officers preferring not to be named said that apart from the rise in the domestic demand in gold, increasing smuggling of gold to India was a major reason for the surge in gold imports. Some officials estimate that around one-third of the total imports makes its way into Indian market through largely unregulated border due to difference in customs duty.

Custom rate on gold import in India is around Rs 466 per ten gram while it is just Rs 130 in Nepal. According to the officials, one can make a net profit of around Rs 250,000 while smuggling one kilogram of gold to India.
Source:Republica