Gold Smuggling into India shut out refiners, banks

 MUMBAI: Indian gold refiners just months ago were ramping up capacity and struggling to secure enough ore from miners. Now, they are suspending operations as a surge in smuggled bullion wipes out wafer thin margins.
Gold importing banks and big jewellers have also been hit by the growing entry of illicit gold, which avoids import duties and makes its way on to the so-called "grey market" where it is sold to end-users at a discount.
SMUGGLING GROWS
India raised the duty on gold imports to 10 per cent three years ago, aiming to dampen buying and narrow the current account deficit in a country where gold is seen as a store of wealth for rich and poor alike.

Smugglers evade the duty and offer cheap gold to buyers such as bullion dealers and small jewellers, who can pay up to $100 an ounce below official domestic prices, currently around $1,340 an ounce.