Gold smuggling continues to plague India, with authorities seizing 4,869.6 kg of illicit gold in the financial year 2024, according to the Directorate of Revenue Intelligence (DRI). Despite a recent reduction in customs duty from 15% to 6%, smuggling syndicates are exploiting porous borders and India’s insatiable gold demand, the DRI revealed in its latest report.
Key Smuggling Routes and Tactics
The Myanmar border remains a major conduit for gold smuggling, with routes such as Tamu-Moreh in Manipur and Zokhawthar in Mizoram becoming hotspots. Smugglers take advantage of the rugged terrain and sparse border controls to transport gold from Myanmar, which often passes through transit hubs like Muse and Mandalay before entering India.
West Bengal’s Siliguri Corridor and routes through Nepal play the role of entrance gate for these smugglers to distribute gold to major Indian cities.
The report highlighted an evolution in smuggling tactics. Gold is hidden in machinery parts, alloyed with other metals, or concealed in modified vehicles with secret compartments. Air cargo and courier networks have also emerged as new channels for smuggling which is making detection increasingly challenging.
Why Smuggling Persists
India relies on imports to meet over 90% of its annual gold consumption, driven by cultural and investment needs. This demand, coupled with price disparities between India and its neighbors, incentivizes smugglers. The “hub-and-spoke” model persists, where smuggled gold is funneled into central hubs and distributed nationwide remains a favored mode of operation.
Once smuggled gold enters India, it is often re-melted and crafted into jewelry, erasing its illegal origins and infusing it into the legal market.
Government and Enforcement Response
Enforcement agencies like the DRI are intensifying efforts to counter smuggling. With over 6,400 cases registered in FY24, surveillance along key routes has been significantly ramped up. Targeted operations and data-driven strategies have become the way to outsmart these sophisticated smuggling syndicates.
Revenue Secretary Sanjay Malhotra emphasized the need for cautious action to strike a balance between curbing smuggling and supporting economic growth.
India’s fight against gold smuggling is far from over, as smugglers continue to adapt their strategies. However, with intensified surveillance and innovative countermeasures, authorities are determined to address the menace head-on.
