QUICK TAKE | India’s Unofficial Gold Imports Jumped to 50 Tonnes. Here Are Seven Things to Know

1. How big is the jump?

Unofficial gold inflows reached an estimated 50 tonnes in July–September 2026, against three tonnes a year earlier, according to the World Gold Council. That is nearly 17 times the earlier volume, the highest since 2023. These are estimates, rather than quantities seized by customs.

2. Why is the duty hike central?

India raised gold import duty from 6% to 15% in May, a nine-percentage-point increase. Evading that duty creates a larger price advantage over legally imported metal. The WGC says higher duties widen the domestic–international price gap and increase incentives for unofficial inflows.

3. Why did the government raise duties?

The aim was to restrain imports, conserve foreign exchange and support the rupee as expensive energy increased pressure on India’s external finances. India relies heavily on imported gold. Discouraging official purchases can also make tax-evading supply more attractive.

4. Does more smuggling mean demand is booming?

No. India’s total Q3 gold demand fell 29% year-on-year to about 162 tonnes. Official bullion imports, including semi-refined doré, declined 70% to 64 tonnes. Supply channels are shifting despite weaker overall consumption.

5. Has this happened after earlier tax changes?

Yes. The WGC says unofficial inflows rose from 17 tonnes in Q2 2022 to nearly 50 tonnes later that year after duties increased. Following the July 2024 cut to 6%, such inflows fell almost immediately to near zero. The pattern supports the incentive argument.

6. How does it affect legitimate sellers?

Tax-evading suppliers can undercut businesses paying import duties. India’s domestic gold price averaged $43 an ounce below import parity in Q3, a record quarterly discount. The WGC attributes the discount to increased unofficial inflows and old-gold supply. Compliant importers must compete within that distorted market.

7. What should jewellery buyers check?

Ask for a proper invoice recording the item’s description, net precious-metal weight and purity. Verify the jewellery’s Hallmark Unique Identification number through the BIS Care app. A hallmark helps establish purity; it does not replace documentation of the transaction or justify a seller’s unexplained discount.