Commodity Trade Mantra

Posts Tagged ‘Gold Smuggling’

Surge in Smuggled Gold Hits Indian Gold Refiners, Gold Jewelers & Banks

Smuggled gold could account for over a third of demand this year in India – the world’s second-biggest buyer of gold – potentially costing the government over $1 billion in lost revenue. Gold refiners have less than a 1% margin. If smugglers offer 4 or 5% discounts, they have no choice but to close operations. All 32 refineries in the country have stopped buying dore until market conditions normalize.

When Gold Confiscation Is a Personal Choice

The day government really wants your gold, it will simply offer a high price to coax it from you, paying with paper money freshly printed that morning. The offer would be high enough to outbid competing market expectations. Many gold owners would happily sell for overnight paper profits. Others, with no trust in government, would keep their gold, choosing to wait and see.

The Escalating War on Cash and What It Means For Precious Metals

While bureaucrats can theoretically win the War on Cash because they have complete control over the issuance of paper money, they cannot win a war on bullion. Physical gold and silver is private and off-the-grid – a nightmare for regulators. The push to eliminate cash will inevitably push people into cash alternatives including physical precious metals.

Gold, Governments and Central Banks

Governments and central banks are frequently criticized by goldbugs for being anti-gold. Examples include the Indian government restricting gold import, the US government refusing to carry out a full audit of the US Treasury’s gold holdings and the Swiss government and central bank strongly opposing the “gold initiative” demands.

Gold Shortage, Worst In 21st Century... And India Just Made It Worse

One event that may stretch the already ridiculous disconnect between physical & swap-based gold, is that India scrapped a rule mandating traders to export 20% of all gold imported into the country, in a surprise move that could cut smuggling and raise legal shipments into the world’s second-biggest consumer of the metal after China.

The Role of India in the Global Gold Market

With such a long pro-gold culture and tradition at the individual and official levels, the role of India in the gold market should not be underestimated. In any reset of the international monetary system, such a large possessor of gold in official and private hands will also play a major, if not a principal, role.

Will BJP's Win Boost Gold Prices In India?

Irrespective of India’s election outcome or BJP’s win and whatever happens to India’s gold policy then in the coming weeks and months, it’s highly unlikely to boost gold prices either way. The root cause of India’s huge gold demand meanwhile remains unaddressed.

Business Man Found With 12 Gold Bars In Stomach In India

When a team of Indian surgeons opened up the stomach of a patient complaining of abdominal pain, they had no idea they’d extract a fortune of 12 gold bars of 33 grams each from his belly. He apparently smuggled them into India to evade import duty, the police and doctors said.

Gold Trade in India Thrives on Uncontrollable Demand

Despite the Indian government having raised the import duty on gold thrice in 2013 to finally at 10%, India’s gold demand is still remarkably high. As a result, gold smuggling is thriving in India – the World Gold Council notes in a recent report that illegal imports came to around 200 tonnes in 2013.

India Eases Gold Import Rules As Smuggling Connected To Campaigns

India eased import regulations to allow some of the private sector banks to buy gold from abroad, a move that could double current monthly gold imports. Election officials are also looking into alleged cases of smaller political allies using smuggled gold to fund their pre-election campaigns.

Gold Smuggling Explodes in India after Moves Intended to Curb Demand

A 38-kg bust of gold smuggling allegedly involving a ring of Afghan women is just the latest example of a massive surge in gold smuggling, evidenced by data on gold seizures at airports. Officials said nearly 85 kgs of gold has been seized by the customs department since the beginning of 2014.

What Is Happening With Gold In India?

Given sustained high inflation & an extremely difficult investment environment in India, Indians desperately need a hedge against inflation. Unfortunately, there are very limited options. Indians love gold & will do so for a foreseeable future. Moreover, gold has done quite well for Indian investors.

Is Renewed Indian Demand Driving Gold Prices Higher?

To ease gold import restriction by end of March would gain votes, so the government has every incentive to do so. Gold prices would be pushed higher by an easing of duties and restrictions on Indian gold imports, disproportionately more than the actual increase in the tonnage then imported.

India Imported 6125 Tonnes Of Silver In 2013 - Up 189 % From 2012

The premiums on gold, currently 15 % above international prices, pushed a lot of Indian savers into silver. India’s silver import in 2013 was 6125 t, an all-time record, up 189 % from 2115 t in 2012. In December silver import accounted for 825 t, up 108 % m/m, 6560 % y/y.

India Tightens Checks to Curb Gold Smuggling

India has started to make physical checks of gold stocks held by wholesalers to ensure inventories match quantity imported as India steps up efforts to halt gold smuggling. This could aggravate shortages in the physical market as authorities seize gold without a valid provenance, boosting premiums.

Gold Events in 2013: Foundation for Movements in 2014

The chronological events of 2013 persuaded investors in western capital markets that gold’s bull market had definitely been broken, and that gold would probably go lower or at best move sideways in 2014. The underlying reality is very different and 2014 should be an interesting year.

Gold Prices Surge On Speculation India May Ease Gold Import Curbs

Gold prices shot up near a six-week high, set for the longest weekly rally since September 2012, based on speculation that India may lower gold import curbs, which may in turn help the the jewelry industry which has shrunk under the curbs while gold smuggling is rising.

Another Phenomenon - Flights Arrive Laden With Gold

It’s raining gold at Kerala’s airport. Every plane landing from the Middle East here now carries 40-80 kg of gold, translating into Customs duties between Rs 86.8 lakh and Rs 1.74 crore – Gold smuggling is back as hiked import duty and restrictions make the precious metal even more precious.

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