(MENAFN) The Reserve Bank of India (RBI) announced that it will curb gold purchases in order to curtail the current account deficit, reported Gulf Daily News.
The central bank said that in the July-September period, current account gap reached 5.4 percent of gross domestic product (GDP), that's equal to USD22.3 billion.
The bank noted that there is a need to notably lower India's current account deficit, considering the unstable global economic situation and its impact on the country's exports.
The bank said that it mulls introducing gold-linked financial instruments to switch savings of people from gold bars and coins into bonds.
In January, the Indian government raised the import duty on gold from 4 percent to 6 percent.
It is worth noting that on annual basis, India buys around 900 tons of gold, primarily through designated banks.
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