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India's trade deficit narrowed in June to $12.24 billion from a 7-month high, helped by a slowdown in gold imports, which should ease pressure on the current account balance and the beleaguered rupee.
Hunger for gold has made it the second biggest item, after crude oil, in the country's import basket. To tamp down gold demand, Indian authorities last month took a slew of measures including a 2 percentage point hike in import duty.
Those measures appear to have worked as the growth in gold and silver imports slowed to 22.8% year-on-year at $2.45 billion last month.
Gold and silver imports had jumped an annual 109% in April and May combined as retail buyers tried to take advantage of sliding global prices.
Overall, merchandise imports rose about 0.73% to $36.03 billion, the trade ministry said on Friday. Exports fell 4.57% from a year earlier to $23.79 billion, their second straight monthly fall.
