CAD control: Govt readying a list of goods for import curbs

By Ruchi Bhatia

The government is likely to announce a list of items for import curbs sometime this week as part of measures planned to check the widening current account deficit and stem the fall in the rupee.

Subhash Garg, Secretary in the Department of Economic Affairs, is working on a comprehensive list of non-essential items for import curbs. Government sources said import duty may be imposed on items like steel, finished steel, furniture, electronics, food items like fruits, almonds and others.


The government is also weighing options to increase import duty on gold, as it sees the risk of a possible spike in gold smuggling if import duty is too harsh.

US tariff measures and a rising dollar are the key reasons behind the fall in the rupee. Government finances have also been under pressure from rising oil prices.

The government expects oil prices to move up further when Iran oil goes offline in November following US sanctions.

On Friday, the government announced a series of steps, including removal of withholding tax on masala bonds, relaxation for foreign portfolio investments and curbs on non-essential imports to contain the widening CAD and check the rupee depreciation.

The government is said to be planning a series of stake sales in various PSUs over the next four months and expects the rupee to stabilise in the medium term.