Gold Smuggling in India May Fall to 50 Tonnes

Mumbai: Going by the seizures of gold which has increased four times in 2013-14, intelligence agencies have estimated gold smuggled in the country around 50 tonnes in 2013-14 which is way lower from the estimated by the World Gold Council (WGC), reports The Business Standard. WGC had estimated nearly 200 tonnes of gold entered India unofficially.

Trade circles have been saying that despite curbs on import of gold, gold was available as unofficial flow was continuing. Availability was a problem only for organised players who were not able to but unofficial gold.

Gold seized during financial year 2013-14 is estimated around 1.45 tonnes against 338 kg in 2012-13. According to data from revenue depart of union finance ministry, in 13-14 till 24 February 2014 1.32 kgs of gold was seized and hence for full year it is estimated around 1.45 tonnes.

The number of seizures in 12-13 was 871 while in 13-14 it was 1379 which means carriers were bringing higher quantities. Official of one of the intelligence agency said that based on their understanding with those caught with gold, smugglers of yellow metal have also developed a business model. They earn 10% when they evade import duty and on an average during 2013-14 physical delivery premiums have remained 8% of the gold price. From this 18% gain they have to cut expenditure which is between 1-2% and hawala premium which was 3-4%. Although off late hawala premiums are said to have come down below 3%.