1273514,Arvind kumar,f1, que10:-Importing Gold into India? Good or Bad for economy?

Introduction

Reserve Bank of India has granted general permission to persons of Indian nationality or origin to bring into India a limited amount of gold and silver. However, import of gold and silver is govern by certain rules and regulation and are given in detail below.

Import of Gold

A NRI who has been residing in a foreign country for over one year and is returning to India may be allowed to import jeweler without paying any custom duty in his use up to an aggregate value of ten thousand rupees in the case of a male passenger. In case of a female passenger, an individual can import gold of up to rupees twenty thousands.
If the amount of gold imported exceeds the import duty free range, then the custom duty charges an amount of Rs. 250 per 10 gms of gold. Even in such a situation, an individual is only permitted to import a maximum of 10 kg of Gold as a part of their baggage after paying the required customs duty. It should also be noted that that these facilities is given only to those passengers who is coming to India after a stay abroad of about six months.
Gold may be brought into India in any form, including ornaments; however, a declaration is needed to be filled by the importer for obtaining the permitted quantity of gold from customs bonded warehouse of State Bank of India or from Metal & Mineral Trading Corporation subject to other conditions.
In case where a passenger has declared the gold, but could not clear it for want of sufficient foreign exchange for paying Customs duty, then re-export of the same may be permitted.

Silver
A Non Resident Indian can import silver in any form up to 100 kilos at a time provided he is coming to India after 6 months stay abroad. Duty is payable @ Rs. 500/- per Kilo. Selling of imported Gold and Silver

Gold and silver so brought by NRIs can be sold to residents against payment in rupees. But it should be credited in rupees and credited to Ordinary Non-resident Rupee (NRO) account of the NRI seller.

Will stopping gold imports help the Indian economy?
No, simply stopping gold imports will not help the Indian economy because a lot of people depend on gold for their livelihood, and they need gold imports to remain in business and survive.
Will slowing down gold imports help – yes it will help because they wouldn’t be such a big drain on our forex reserves and that will be great.
However, the recent rise in gold imports has been investment driven and that is largely due to the rise in gold prices and a lack of other investment alternatives available to Indians.
Simply increasing duty on gold does nothing to alleviate either of these causes and that won’t do anything to help the economy. What we need is a better investment climate that helps people get other alternates to gold for investment, and that also helps with the other factors that I wrote about above related to bringing in foreign exchange in the country. You want a climate where exports rise (services exports declined last month), foreign investments come into the country – both in the form of FDI and FII, and all that in turns help the CAD.