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Indian authorities are finally reacting to a gold importing scheme that’s been bringing thousands of tonnes of gold into the country despite severe restrictions on bullion imports.
Financial documents of non-resident Indians traveling to India are being scrutinized in order to see if gold traders are paying them to bring in the goods.
According to the Khaleej Times, it’s mostly “low income expatriate workers in the Gulf — deployed by organised gang of ‘indirect’ importers” that transport the yellow metal.
While India has introduced a series of measures to restrict the flow of gold into the country, traders have taken advantage of a loophole that allows non-resident to carry 1kg of gold when they enter India. It’s been reported that traders are paying the airfare of some travelers in exchange for transportation of the precious metal.
Under the new measure, customs authorities will tip off the tax bureau when someone comes into the country carrying gold. The tax department will “ascertain source of their income and avoid possibility of any wrongdoing,” an official told India’s Economic Times.
Officials say that at least 3,000kg of gold was legally brought into the country last year, according to Economic Times.
After oil, gold is the biggest contributor to the country’s current account deficit, which is why the Reserve Bank of India is so keen on curbing imports.
