Archive · 28 Jun 2025
Gold Imports Cloud India's Economic View, Analysis Shows
India often runs a deficit in its current account, which is like keeping track of money coming in and out of the country.
However, if you take out the money spent on gold imports, the picture looks better.
This means that if India didn't buy so much gold, its finances would be in better shape, with periods of surplus.
The recent data indicates strong underlying economic health, highlighting that while gold is a financial asset, it significantly affects India's balance.
India's current account deficit is significantly impacted by gold imports.
Excluding gold, India's current account shows periods of surplus, even during the pandemic.
Gold imports contributed to deficits, ranging from $5-15 billion per quarter between 2011 and 2013.
Recent data shows a $22.981 billion surplus net of gold in the October-December 2024 quarter.
Managing gold demand and boosting exports is key for sustainable external balance.
- Who
- Deepak Shenoy, CEO of Capitalmind AMC.
- What
- Analysis shows gold imports significantly impact India's current account deficit.
- When
- Data from April 2011 to December 2024.
- Where
- India.
- Why
- To understand the true strength of India's external balances by excluding the impact of gold imports.
Current Account Deficit View
Current Account Surplus View
Overall Balance
Current Account Deficit View
Current account often appears in deficit.
Current Account Surplus View
Excluding gold imports reveals surplus periods.
- Analysis Period
- April 2011 - December 2024
- Surplus Net of Gold (Q4 2024)
- $22.981 million
- Gold-related deficits (Q3 2024)
- $9.501 million
- Gold-related deficits (Q4 2024)
- $19.467 million
- Peak Surplus (April-June 2019)
- $19,771 million
Sources
India records current account surplus in Q4, net services receipts increase
India records $13.5 bn current account surplus in Q4 FY25: Reserve Bank
India records $13.5 bn current account surplus in Q4 FY25: RBI
India’s forex reserves dip by $1.01 billion to $697.93 billion, RBI data shows
Early months of FY26 indicate resilient economy, outlook remains positive: Centre