Whalesbook
Regulatory Delays Halt Bullion Shipments
The issue arises from a significant delay in renewing import permits by the Directorate General of Foreign Trade (DGFT). These permits, which nominated banks need to import precious metals, expired on March 31. With new authorisation still pending, banks have stopped placing new overseas orders, according to sources.
Several tonnes of gold and silver are reportedly held up at customs checkpoints as banks await regulatory clearance. This has effectively stalled new imports and tightened domestic supply just as demand is usually starting to rise.
Timing is Critical Ahead of Festive Demand
India is a major global consumer of precious metals, ranking second in gold demand and first in silver. The country imports most of its supply to meet this high demand. This delay comes at a critical time, just before Akshaya Tritiya, a significant festival for gold purchases.
Jewellers usually stock up before this busy period to meet customer demand. If import disruptions continue, retailers could face significant shortages. This scarcity may push up local bullion prices during the crucial festive sales window.