Indian banks have temporarily stopped placing fresh import orders for gold and silver after a delay in receiving the required government authorization, according to trade sources. The disruption has left several tonnes of bullion stuck at customs and raised concerns over possible supply shortages in the domestic market. India is one of the world’s largest consumers of gold and the biggest importer of silver, making the delay significant for jewellers, traders, and consumers.
Why Imports Have Been Halted
Every year, the Directorate General of Foreign Trade (DGFT) issues a fresh order listing banks authorized by the Reserve Bank of India to import gold and silver. The previous authorization, issued in April 2025, expired on March 31, 2026 at the end of the financial year.
Banks expected a new directive in early April, but as of April 17 no updated order had been issued. Because of this regulatory gap, banks have paused fresh overseas import orders until official clearance arrives.
Gold and Silver Already Stuck at Customs
The delay has already affected shipments that arrived in India. According to trade sources:
- More than 5 tonnes of gold are stuck without customs clearance
- Around 8 tonnes of silver are also awaiting clearance
- New import orders are being avoided until older consignments are released
Bullion dealers said there is little sense in placing new orders when previously imported metal cannot enter the market.
Why This Matters for India
India depends heavily on imports to meet domestic precious metal demand.
- India is the world’s second-largest gold consumer
- India is the largest silver importer globally
- Domestic jewellery, investment, and festive demand rely on imported bullion
Any extended halt in imports can create shortages in supply chains and affect pricing across jewellery and bullion markets.
Risk of Supply Shortage Before Akshaya Tritiya
The timing of the disruption is especially sensitive because India is approaching Akshaya Tritiya, one of the country’s biggest gold-buying festivals. Demand for jewellery and coins usually rises sharply during this period.
Industry representatives warned that if imports do not resume soon:
- Gold premiums may rise
- Retail jewellery prices could increase further
- Delivery delays may occur
- Smaller jewellers may face stock pressure
Surendra Mehta of the India Bullion and Jewellers Association reportedly called for immediate clarity so imports can restart.
Gold Demand Already Under Pressure
Even before the import issue, demand had weakened due to high prices. Reports said India’s gold demand in 2025 fell to 710.9 metric tonnes, the lowest level in five years.
Domestic prices recently surged, discouraging many retail buyers from advance festive purchases. This means the market is dealing with both high prices and supply uncertainty at the same time.
Impact on Rupee and Trade Deficit
Some traders suggested the delay may also help reduce India’s import bill temporarily. Gold and silver imports add pressure to the trade deficit because they require foreign currency outflows.
With rising costs of oil, gas, and fertilizer due to the Iran conflict, lower bullion imports could:
- Narrow the trade deficit
- Reduce pressure on the rupee
- Ease dollar demand in the short term
Reuters separately reported the rupee touched a one-week high amid broader RBI support measures.
Stock Market Reaction
Jewellery-related stocks reacted negatively to the news:
- Shares of Titan fell
- Kalyan Jewellers also declined sharply
- Investors worried about supply disruption and margin pressure
At the same time, some traders speculated certain trading firms may benefit from any change in supply channels.
What Happens Next
The market is now waiting for the DGFT to issue the new authorization order. Once the clearance arrives:
- Customs clearance of stuck bullion may resume
- Banks may restart fresh imports
- Supply concerns could ease quickly
However, if delays continue, shortages and higher premiums may become more visible in the coming weeks.
Conclusion
The temporary halt in gold and silver imports highlights how administrative delays can quickly affect India’s bullion market. With tonnes of precious metals stuck at customs and festive demand approaching, traders and jewellers are seeking urgent clarity from the government. A quick resolution could stabilize supply, while a prolonged delay may push prices higher and tighten availability across the country.
