Gold imports declined by about 8 per cent to USD 31.72 billion in 2015-16 due to weak global prices and are expected to keep a lid on the country's current account deficit.
Gold imports stood at USD 34.38 billion in 2014-15.
The sliding prices of the precious metal in both global and domestic markets are seen as a contributory factor for the plunge.
In March, the imports dipped for the second consecutive month in March. It fell by 80.48 per cent to USD 972.96 million.
The contraction in the imports helped narrow trade deficit to five-year low of USD 5.07 billion last month. The deficit was at USD 11.39 billion in the year-ago period.
India is the largest importer of gold in the world and the imports mainly cater to the demand of jewellery industry.
India's current account deficit (CAD) narrowed to 1.3 per cent of GDP in third quarter of the fiscal 2015-16 as against 1.5 per cent in the same period previous year, mainly on account of lower trade deficit.
Dip in gold imports have impacted the exports of gems and jewellery. Gems and jewellery export grew by just 4.6% in March to USD 3.61 billion.
