Koos Jansen
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Koos Jansen
Posted on 17 Nov 2014 by

India Precious Metals Import Explodes In October

Despite all efforts from the Indian government to curtail India’s demand for precious metals – for example a 10 % import duty on both gold and silver, the Indian people continue to put their savings in a store of value they consider being prudent; precious metals.

By hiking the import duty on gold in 2013 from 4 % to 10 % and the implementation of the 80/20 rule importers were thwarted shipping in metal. In part because the importers  needed to find out how to work through the new rules, which were deliberately setup to complicate the process.  

At first official gold import dropped like a brick, the premium on gold over London spot sky rocketed to 25 % and smuggling flourished.

Since 2014  India’s customs department, the DGCIS, discloses preliminary estimates on commodity trade data (only imports for precious metals). The latest data shows gross gold import in October jumped to 106 tonnes, up 13 % m/m, up 260 % y/y. 106 tonnes gross import is 1,271 tonnes annualized.

India Gold Import October 2014

Year to date India has officially gross imported (ex smuggling) 597 tonnes of gold, down 21 % y/y, annualized 716 tonnes.

Recent history has demonstrated that the more gold is imported through official channels the less pressure there is on the premium of gold in India. Throughout October the premium hovered around 2.5 %, excluding the 10 % import duty.

India Gold Premium November 2014

India gross imported a whopping 1,243 tonnes of silver in October, up 54 % m/m, up 217 y/y. This is one tonne short of the 1,244 tonnes record of May 2011.

India Silver Import October 2014

Year to date India has gross imported 5535 tonnes, up 13 % y/y, annualized 6,641 tonnes.

Premiums on silver in India floated around 2 % throughout October, excluding the 10 % import duty.

India Silver Premium November 2014

Koos Jansen
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  • sb

    So far in November India imported 86mt of gold, If it continues like that it is going to be a record month.

  • KoosJansen

    Damn, your comment got lost in a spam box. Glad I found it. Thanks!

  • jmb

    If stock markets are crashing as they are now, bonds are ususally natural choice of substitute investments. But then, Bonds yields so low and their price so high as they are now…. There aren’t that many investment tools left. Physical gold and gold miners are natural choice,imo.

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