Ahead of the bullion traders’ strike on March 10, Finance Minister P Chidambaram made it clear that any decision on relaxing import curbs would be taken only after the final current account deficit (CAD) number is firmed up.
The official CAD number comes usually after a two-month lag. The number for October-December quarter was announced on March 5. It is estimated that the final number for 2013-14 will come out in June. It implies any decision on relaxing import curbs, such as lowering import duty or removing the ‘80:20 scheme’ may have to wait. Chidambaram said any relaxation in the restrictions“can be revisited only after final CAD numbers are there. Had CAD not been contained and fiscal deficit not brought down sharply, the consequences would have been enormous.”
Bullion traders say the curbs have jeopardised the demand and supply chain.