Impasse over RBI's 80:20 gold import scheme ends
The government cleared the confusion that was going between the Customs Department and gold importers regarding the RBI’s 80:20 scheme which was introduced in July 2013.
What is 80:20 scheme of RBI?
Under this scheme, the importers are directed to export back 20% of the total gold imports. It prohibits further imports if this 20% norm is not met by importers. The step was aimed at curbing rising gold import which led to high Current Account Deficit.
Why there was a deadlock over 80:20 scheme of RBI?
The RBI 80:20 norm left many confused, leading to imports being held up at customs. It was wrongly interpreted that an importer could not export more than 20%. Whereas, the case was otherwise as it means that at least 20% is give for exports and one can export more than 20% of total imports. Due to this confusion the customs officials had stopped stocks from entering the country. With this clarification, gold imports are likely to resume.
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Month: Current Affairs - September, 2013