First Business News Portal in English from Nepal
KATHMANDU: The government has recently made the decision to raise the daily import quota for gold by an additional 10 kilograms. This move was prompted by discussions between the Ministry of Industry, Commerce, and Supplies and representatives of the Nepal Gold and Silver Dealers’ Association. As a result, the daily gold import quota has been increased to a total of 20 kilograms.
This decision to boost the gold import quota was reached in a meeting held in mid-September, and it has garnered optimism among gold traders in Nepal.
The responsibility for regulating gold imports in the country primarily rests with the Nepal Rastra Bank, while commercial banks handle the actual import and subsequent sale of gold. Gold is predominantly imported from countries such as Dubai, Hong Kong, Switzerland, and Singapore.
To implement the increased import quota of 10 kilograms, the Nepal Rastra Bank will issue a circular outlining the new regulations. This decision has been well-received by some gold traders, who view it as a positive development.
As the festive season approaches, there has been a growing demand for gold, leading jewelry traders to advocate for a higher import quota. Meetings have been held with relevant authorities, including the Minister of Industry, Commerce, and Supplies, the Finance Minister, and representatives from the Nepal Rastra Bank, to push for this increase.
Initially, traders had requested a daily quota of 35 kilograms, but the Ministry of Industry, Commerce, and Supplies approved a temporary increase to 20 kilograms.
The government’s implementation of a quota system aims to manage and encourage gold imports in response to market demand. The current daily quota of 10 kilograms will be adjusted to meet the anticipated surge in demand during the upcoming festival season.
Traders expect the daily gold demand to rise to 15 kilograms and potentially reach 35 kilograms during the Dashain and Tihar festivals.
The recent decision to raise the gold import quota by 10 kilograms has generated optimism within the gold trading community, especially as it addresses the increasing demand for gold in the market.
In recent months, there has been a surge in gold demand, leading to a shortage of gold reserves in banks. Traders have been advocating for an increased quota to ensure a stable supply of gold.
According to data, after commercial banks imported gold, the Nepal Rastra Bank’s gold reserves were significantly depleted, prompting the bank to sell gold from its reserves to meet the demand. As the festive season approached, gold reserves in the Nepal Rastra Bank dwindled further.
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