Indian banks have abruptly suspended fresh import orders for gold and silver, leading to a massive backlog of precious metals at the country’s borders. The halt is primarily due to a delay by the Directorate General of Foreign Trade (DGFT) in issuing the annual authorization order that specifies which banks are permitted to import bullion for the new financial year.
As of today, more than 5 tonnes of gold and 8 tonnes of silver are reportedly stranded at customs, unable to be cleared without the fresh mandate.
The “Authorization Gap” Explained
In India, the import of precious metals is a strictly regulated process. Each year, at the beginning of the fiscal year (April 1), the DGFT—under the Ministry of Commerce and Industry—issues a formal notification listing the banks authorized by the Reserve Bank of India (RBI) to import gold and silver.
- Expired Mandate: The previous authorization, issued in April 2025, expired on March 31, 2026.
- Delayed Renewal: While banks expected the new list in the first week of April, no notification has been released as of April 17.
- Operational Paralysis: Without the valid DGFT order, customs officials cannot release arriving shipments, and banks have stopped placing new orders to avoid further storage and insurance costs on stranded bullion.
Double Whammy: New Import Curbs on Jewellery
Compounding the supply issue, the government also imposed immediate import curbs on all articles of gold, silver, and platinum on April 2, 2026.
- FTA Misuse: The move is specifically aimed at stopping the misuse of Free Trade Agreements (FTAs), particularly the India-ASEAN pact. Traders were reportedly routing finished jewellery through countries like Thailand and Indonesia to bypass the standard 15% import duty.
- “Restricted” Status: These items have been moved from the “Free” to “Restricted” category, meaning importers now require a specific license from the DGFT for every shipment, regardless of prior contracts or letters of credit.
Market Impact and Supply Crunch
The timing of the halt is particularly critical as it comes just weeks before Akshaya Tritiya (falling in late April/early May 2026), one of the most significant gold-buying festivals in India.
| Impact Factor | Consequence |
| Domestic Premiums | Premiums on physical gold in India have begun to rise as local stockists scramble for available supply. |
| Global Prices | As the world’s second-largest gold consumer and largest silver buyer, a sustained Indian “strike” could put downward pressure on international spot prices. |
| Rupee Stability | The temporary halt in imports actually helps narrow India’s trade deficit and provides a minor cushion for the Indian Rupee, which has faced volatility this month. |
Estimated Stranded Bullion (as of April 17, 2026)
- Gold: ~5.2 Tonnes
- Silver: ~8.5 Tonnes
- Estimated Value: Over ₹5,500 crore ($660 million).
Bullion Dealer Insight: “It’s a complete logjam,” said a Mumbai-based dealer at a private bank. “We have shipments sitting on the tarmac that we can’t touch. Until the DGFT hits ‘send’ on that notification, the formal gold trade in India is effectively on life support.”
