Indian gold imports fall to 30-year low of 15 tonnes in April as banks halt purchases
India’s gold imports are set to fall to a near 30-year low of around 15 tonnes in April after local banks were hit with an unexpected tax, industry and government sources said on Friday.
Most of India’s refined gold is imported by banks, but they have completely halted shipments since Indian customs began demanding a 3% integrated goods and services tax on the metal, according to Surendra Mehta, secretary at the India Bullion and Jewellers Association.
When India adopted the IGST in 2017, gold-importing banks were exempted from paying the 3% levy. The tax now being imposed on banks follows a delay in issuing a formal government order authorizing bullion imports by banks, Reuters reported earlier this month.
“Banks did not clear any gold from customs this month,” said a government official, who declined to be named as they were not authorized to speak to the media, who added that a small quantity of imported gold was cleared via the India International Bullion Exchange (IIBX).
India’s tax authorities did not immediately respond to requests for comment from local media on the IGST now being imposed on banks’ gold imports.
India, the world’s second-largest gold consumer, imported 35 tonnes of gold in April 2025 and averaged about 60 tonnes a month in fiscal year 2025-26 ending in March.
April’s 15-tonne total is the lowest figure for the month in around three decades, apart from 2020 when the Covid-19 pandemic forced Indian jewelry shops to close. Local sources said the dramatic drop in imports could weigh on global gold prices.
On April 29, the World Gold Council (WGC) announced that India's investment demand for gold surpassed jewelry consumption for the first time on record in the March quarter, as investors turned to the precious metal amid subdued equity market returns.
Stronger investment demand partially offset a decline in jewelry buying, the WGC said, which helped keep overall demand stable,
"For the first time investment demand surpassed jewelry demand," Sachin Jain, chief executive of the WGC's Indian operations, told Reuters.
"Investment demand will become increasingly prominent in the coming quarters, with both financial and retail investors showing more interest in gold."
Investment demand in the March quarter surged 52% from a year earlier to 82 tonnes, while jewelry demand fell 19.5% to 66 tonnes, the World Gold Council (WGC) said in a report published earlier this week.
Total gold consumption in the country rose 10.2% to 151 tonnes during the quarter, the report noted.
For the first time, investment demand accounted for a larger share of total consumption than jewelry, rising to 54.3% in the quarter. Investment demand typically accounts for about a quarter of India's total gold consumption, but rising prices have been prompting investors to buy coins, bars, and gold exchange-traded funds (ETFs).
Inflows into Indian gold ETFs surged 186% in the March quarter from a year earlier to a record 20 tonnes, the WGC said.
