Smuggling gold into India is set to get tougher as the government is expected to tighten security along the borders in the aftermath of last week’s terror strike in Pulwama, gold traders and bullion dealers said.
“Following this ghastly terror attack in Pulwama, it is expected that the government will beef up security in the border region. So, this will bring down the entry of gold through the borders,” Surendra Mehta, national secretary of the India Bullion & Jewellers Association told.
Traders had earlier indicated that the quantity of smuggled gold may increase by 25-50 per cent over last year because of the high price of the metal and 10 per cent import duty. About 120 tonnes of gold were smuggled into India in 2017, according to industry estimates. Gold demand in India was 760.40 tonnes in 2018, according to the World Gold Council. “The geopolitical tension between the two countries may see gold prices shooting up due to a depreciating rupee,” said Mehta.
Gold prices have increased 10 per cent since December 28. Gold traded at Rs 33,400 per 10 gm in the spot market on Monday. “Nobody is keen to buy gold. consumers and jewellers are not buying gold. There is no demand in the market,” said Mukesh Kothari, director of RiddiSiddhi Bullion. Kothari said even though there are indications that gold prices will move up in the coming months, there is no interest from the investors at this time