ICICI Bank Ltd said Reserve Bank of India authorized it in Feb 2002 to import gold/silver/platinum under Exim-Policy 1997 for sale in wholesale domestic market. As of now there are about 15 banks authorized to import bullion. In terms of RBI approval the bank commenced import of gold/silver in May 2002. The import of gold/silver in form of Ten Tola or KG bars is primarily meant for sale in wholesale domestic markets.
The retail sale of gold in smaller denominations was introduced in December 2002. RBI recently allowed banks authorized to trade in gold and silver to take open position within overall foreign exchange limit. The RBI also permitted authorized banks to enter into forward contracts of up to six months tenor, with their constituents having underlying gold/silver transactions.
The banks are also allowed to hedge their position either with other authorized banks or through exchange traded or over the counter products available overseas. RBI also permitted authorized banks to offer forwards up to six months in gold and silver to domestic constituents having underlying price risk.
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