Gold smuggling surges in India as prices skyrocket
Gold smuggling into India has risen sharply ahead of major festivals like Dhanteras and Diwali, officials told Reuters. Smuggling had decreased last year after the government lowered import taxes from 15% to 6%, but recent weeks have seen a rise in illegal activity, with several attempts stopped at airports. Strong festival demand and limited supply have made smuggling more profitable, with margins now exceeding 1.15 million rupees per kilogram of gold.
Gold prices in India reached a record high of 128,395 rupees per 10 grams, up 67% this year, making smuggling highly lucrative. Banks are struggling to meet demand, pushing premiums up, with some dealers charging $25 per ounce more than official prices. Last fiscal year, authorities recorded 3,005 cases of smuggling and seized 2.6 tons of gold.
