What Happened
- The Directorate General of Foreign Trade (DGFT) issued a fresh notification authorising nominated banks to import gold and silver under a renewed framework valid from April 1, 2026 to March 31, 2029.
- The authorisation came after a brief disruption during which approximately 5 tonnes of gold and 8 tonnes of silver were stuck at Indian ports, as banks had halted fresh import orders following the expiry of the previous authorisation on March 31, 2026.
- Fifteen banks were authorised to import both gold and silver, including State Bank of India, HDFC Bank, ICICI Bank, Axis Bank, Kotak Mahindra Bank, Punjab National Bank, Deutsche Bank, Federal Bank, IndusInd Bank, Bank of India, Indian Overseas Bank, Karur Vysya Bank, RBL Bank, Yes Bank, and Industrial and Commercial Bank of China. Two additional banks — Union Bank of India and Sberbank — were permitted to import gold only.
Static Topic Bridges
Directorate General of Foreign Trade (DGFT)
DGFT functions under the Ministry of Commerce and Industry and is responsible for implementing India's Foreign Trade Policy (FTP). It regulates export and import activities through licences, authorisations, and notifications. Under the FTP, certain sensitive commodities — including gold and silver — are placed in a "restricted" category, meaning they can only be imported by entities specifically nominated or authorised by the RBI or DGFT.
- DGFT operates under the Foreign Trade (Development and Regulation) Act, 1992.
- The FTP is typically issued for five-year periods; the current policy is FTP 2023.
- Gold and silver fall under ITC-HS Chapter 71 (Precious Metals) and are classified as "restricted" items, not freely importable.
- Nominated agencies include RBI-approved banks, the MMTC, and qualified jewellers recognised under the India International Bullion Exchange (IIBX) framework.
Connection to this news: The delay in issuing the fresh authorisation list caused a temporary halt in gold and silver imports, exposing the operational sensitivity of India's bullion import architecture. The three-year authorisation window provides stability for banks planning import operations.
Gold Import Regulation and Current Account Dynamics
India is the world's second-largest consumer of gold, importing 700–900 tonnes annually. Gold imports are a significant contributor to India's Current Account Deficit (CAD). Because India produces negligible domestic gold, the entire demand for jewellery, investment, and industrial use must be met through imports. High gold imports widen the trade deficit and put pressure on the rupee.
- India's gold imports were approximately $46 billion in FY24.
- The RBI nominates banks to import gold under the Gold Monetisation Scheme and related frameworks.
- The India International Bullion Exchange (IIBX), established in GIFT City (IFSC), allows qualified jewellers to import gold directly, providing an alternative to bank-led imports.
- The import duty on gold is currently 6% (reduced from 15% in the Union Budget 2024-25) to curb smuggling.
Connection to this news: The brief import stoppage highlighted how a procedural delay in DGFT's authorisation renewal can disrupt bullion supply chains, affect prices in domestic wholesale markets, and potentially encourage informal (smuggled) gold imports.
India International Bullion Exchange (IIBX)
IIBX, launched in 2022 at GIFT City (Gujarat International Finance Tec-City), is India's first international bullion exchange. It allows qualified jewellers to directly import gold, bypassing the traditional bank-led route. The exchange operates under the International Financial Services Centres Authority (IFSCA).
- IIBX is regulated by IFSCA under the IFSCA Act, 2019.
- It enables price discovery, reduces import costs for jewellers, and deepens India's financial markets.
- The India-UAE CEPA (Comprehensive Economic Partnership Agreement, signed 2022) includes a Tariff Rate Quota (TRQ) allowing gold imports from the UAE at concessional duty through IIBX-registered vaults in GIFT City SEZs.
Connection to this news: While IIBX provides an alternative import channel for qualified jewellers, the bulk of India's gold imports still flow through DGFT/RBI-nominated banks, making the timely renewal of bank authorisations critical for uninterrupted supply.
Key Facts & Data
- 17 banks authorised: 15 for gold + silver; 2 (Union Bank of India, Sberbank) for gold only.
- Previous authorisation expired March 31, 2026; new authorisation covers April 1, 2026 – March 31, 2029.
- ~5 tonnes gold and ~8 tonnes silver were stuck at ports during the authorisation gap.
- India's annual gold consumption: approximately 700–900 tonnes (second largest globally).
- Import duty on gold reduced to 6% in Union Budget 2024-25 (from 15%).
- DGFT operates under the Foreign Trade (Development and Regulation) Act, 1992.
- Gold falls under ITC-HS Chapter 71; classified as "restricted" import requiring nominated agency.