The Finance Ministry today said the government could take more steps to reduce gold imports, which may include banning sale

of the yellow metal by banks.

"More steps will have to be taken to reduce gold imports. Export import policy on gold will have to be reviewed. May consider

banning gold coin sale by banks," Department of Economic Affairs Secretary Arvind Mayaram said.

He was talking to reporters after a meeting of the sub-committee of Financial Stability and Development Council (FSDC),

headed by RBI governor D Subbarao.

The Committee also discussed, among other things, regulations of chit funds, Mayaram said.

Gold and silver imports during April, 2013 jumped by 138 per cent to USD 7.5 billion against USD 3.1 billion in the year-ago

period. Due to high gold imports, the country's trade deficit in April widened to USD 17.8 billion year on year.

Higher trade deficit in turn puts pressure on Current Account Deficit (CAD), which has been described as the biggest risk to the

Indian economy by the RBI.

The CAD, which is difference between the outflow and inflow of foreign currency, touched a record high of 6.7 per cent in the

October-December quarter on the back of rising oil and gold imports.

Last month, the RBI had imposed curbs on import of the yellow metal by banks. Besides, it has also put restrictions on banks

and NBFCs for providing loans against gold coins as well as units of gold ETFs.

The government has also taken steps like hike in import duty to restrict gold imports.

Gold imports into India, the world's largest consumer of the metal, stood at around 830 tonne in 2012-13.

The FSDC sub-committee discusses issues relating to the financial sector development and stability, including issues relating to

inter-regulatory coordination. The sub-committee includes financial sector regulators and DEA Secretary.

Govt may take more steps to curb gold import:

FinMin

The passion for gold is causing imports and it is

leaving a big hole in the current account deficit," Mr

Chidambaram said.

The government is worried over the widening current

account deficit (CAD), largely on account of the runaway

rise in imports of the yellow metal which stood pegged at

162 tonnes during May alone.

Gold imports jumped by 138 per cent last month, the

highest so far this year, pushing up the trade deficit to

$17.8 billion.

STEPS TAKEN TO CURB

IMPORTS OF GOLD AND

MAJOR IMPROVEMENTS

raising import duty, to curb the inbound shipments of gold

The Reserve Bank of India (RBI) too had put restrictions

on banks on gold imports.

the rising imports of gold which may include a ban on sale

of gold coins by banks.

imposed restrictions on them and non-banking finance

companies (NBFCs) to check loans against gold coins as

well as units of gold ETFs (exchange traded funds).