HSBC Indian gold demand to increase
Duncan Richardson, News Editor
3 Jul 2014, 7:59 a.m.
HSBC expects gold demand in India to increase if the newly elected government reduces the gold import tax. Prior to be being elected the Bharatiya Janata party promised to review the extremely unpopular tax. The import tax was introduced to reduce the country’s current account deficit and protect the value of the Indian Rupee.
Data compiled by the All India Gems and Jewellery Trade Federation estimates the tax caused gold imports to drop by 77% to 150 metric tonnes in the first half of 2014 down from 450 tonnes in the first six months of 2013.
As a result of the tax China overtook India as the world’s largest consumer of gold.