RBI allows more banks to import gold

More banks have been allowed by the Reserve Bank of India to import gold under its 80:20 scheme. The scheme entails that the banks export 20 percent of their gold imports and utilize the remainder 80 percent for domestic use. Fresh imports are only allowed after the 20 percent have been exported. The RBI had raised import duty on gold and imposed the 80:20 import scheme in order to restrict gold imports and thus reduce the country’s current account deficit.

The banks being granted the permission include Axis Bank, Kotak Mahindra Bank, IndusInd Bank and Yes Bank, reports add. The inclusion of additional banks to import is being viewed as one that can aid in easing the curtailed imports of gold, an increase in supply and a reduction in premiums, reports add.

Apart from the new names on the list of banks being permitted to import gold, six banks and three financial institutions were permitted to import the metal under the 80:20 scheme.