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India's gold tariff hike prompts smuggling revival, squeezes banks and refiners
By Rajendra Jadhav
Reuters
Tuesday, June 9, 2026
MUMBAI -- India's sharp increase in gold import tariffs is fueling a resurgence in smuggling that could exceed 100 metric tons this year, as soaring gray-market margins allow smugglers to undercut banks and refiners of the precious metal, industry officials and bullion dealers said.
India, the world's biggest gold market after China, more than doubled import tariffs to 15% in May to curb demand, cut the trade deficit, and ease pressure on the rupee. But the move has created an opportunity for smugglers who are able to offer prices legitimate importers cannot match, they said.
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The gray-market discount has gone beyond $200 per ounce, or more than 4%, said a Mumbai-based bullion division head at a private gold-importing bank, adding that banks were unable to offer even a $10 discount, let alone one of three digits. He declined to be named because he was not authorised to speak to media. ...
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