Steps taken to address high current account deficit: Govt
New Delhi: To arrest widening current account deficit (CAD), a number of measures to boost exports and lower gold imports have been taken, government has said.
"The government is seized of the matter concerning higher CAD and has undertaken several measures to address the issue," Minister of State for Finance Namo Narayan Meena said in a written reply to the Lok Sabha.
The CAD, which represents the difference between inflows and outflows of foreign currency, had widened to 4.2 percent of GDP in 2011-12, and had touched a record high of 5.4 percent of GDP in July-September this fiscal.
Meena said the government has announced extension of interest subvention scheme for select employment oriented sectors up to March-end 2014 and introduction of pilot scheme of 2 percent interest subvention for project export through Exim Bank of SAARC region among other measures.
On measures to reduce gold imports, the minister said, "the government has further enhanced the customs duty on gold and platinum from 4 percent to 6 percent in January 2013 to lower the import of gold."
Meena further said the government has proposed to provide link between the Gold Exchange Traded Fund (ETF) and the gold deposit scheme with an objective to release a part of gold physically held mutual funds under Gold ETF.
Last three years have seen substantial rise in gold imports contributing significantly to the current account deficit.
On a separate question, Meena said fake currency with face value of Rs 25.5 crore (Rs 25,54,14,088) has been seized and recovered by the government in 2012.
On measures taken to check the menace of fake currency notes, the minister said RBI has incorporated new security features in banknotes and has given instructions to banks to disburse only sorted and genuine notes through their counter/ATMs.
Asked whether there is shortage of coins of various denominations in the country, Meena said the complaints of shortage of coins are mainly in Re 1 and Rs 5 segment.
On measures taken to address the problem, he said that more remittance of coins were sent to Currency Chests (CCs) in the areas where shortage of coins was reported and banks have been advised to organise coin melas for issue of coins to members of public among other measures.