MUMBAI, Aug 19 (Reuters) - The value of Indian imports of edible oils and pulses is set to plummet as international prices drop and domestic output climbs in the wake of heavy monsoon rains, helping save the country around $4 billion as it struggles to narrow a gaping current account deficit.

That nearly equals the amount the government aims to save in its high-profile battle to restrict gold imports, a key part of its efforts to stem the deficit that has pushed the rupee to a record low and threatens higher inflation as the economy grows at its slowest pace in a decade.

Lower demand from the world's No.1 importer of pulses would pile more pressure on prices that have fallen nearly 20 percent so far this year. Edible oil prices would also be hit at a time when palm oil supplies are rising.

" The demand for imported pulses is very weak. Traders are struggling to sell imported stocks despite reducing prices," said Nitin Kalantri, a miller based in Latur in the western state of Maharashtra.

Industry officials estimate India could save nearly $3 billion from imports of edible oils this year and $1 billion on pulses. In the 2012/13 financial year, which ended on March 31, India's edible oil imports stood at a record $11.31 billion, while it spent an all-time high of $2.34 billion buying pulses overseas.

 

Above-normal rainfall since the beginning of the monsoon season on June 1 promises bumper production of edible oils and pulses, used in dishes from samosa to curries. The ingredients account for nearly two-thirds of the country's imports of agricultural commodities