MUMBAI: India’s April gold imports are set to fall to a near 30-year low of around 15 tonnes, industry and government sources said, because banks have been hit by an unexpected tax demand.

Banks, which import most of India’s refined gold, have halted shipments since Indian customs began demanding a 3pc integrated goods and services tax on the metal, said Surendra Mehta, secretary at the India Bullion and Jewellers Association.

In 2017, when India adopted the IGST, gold-importing banks were exempted from paying the 3pc levy.

The tax demand now being imposed on banks follows a delay in issuing a formal government order authorising bullion imports by banks, Reuters reported earlier this month.

“Banks did not clear any gold from customs this month. A small quantity was cleared via the India International Bullion Exchange (IIBX),” said a government official, who declined to be named as they were not authorised to talk to the media.

India’s tax authorities did not immediately respond to a request for comment on the IGST now being sought on gold imports by banks.

India, the world’s second-largest gold consumer, imported 35 tonnes of gold in April 2025 and averaged about 60 tonnes a month in the fiscal year 2025-26 to March.

The 15-tonne figure for April is the lowest for the month in around three decades, excluding 2020 when the Covid-19 pandemic forced Indian jewellery shops to close, and could weigh on global gold prices, the sources said.

Published in Dawn, May 1st, 2026