India’s bullion market is facing fresh uncertainty as concerns over a Supply shortage of gold, silver grow sharper. Banks have reportedly paused new import orders after gold and silver shipments were held up at customs due to the absence of a fresh government notification.
In simple terms, India depends heavily on imported bullion. If imports slow down, domestic supply can tighten, premiums may rise, and buyers could feel the impact ahead of major festivals like Akshaya Tritiya.
Supply shortage of gold, silver: What is happening right now?
Banks in India have temporarily stopped placing new import orders for gold and silver from overseas suppliers after existing shipments became stranded at customs, according to trade sources.
The issue stems from a pending annual notification that usually authorises specific banks to import bullion. This notification is typically issued at the start of every financial year by the Directorate General of Foreign Trade (DGFT), under the Ministry of Commerce and Industry.
The previous notification, issued in April 2025, expired on March 31, and the market is still waiting for a new order.
Quick Answer: Why are imports stuck?
Because customs clearance for bullion imports is linked to the updated annual authorisation list. Without the latest notification, shipments are reportedly unable to move forward smoothly.
Why the Supply shortage of gold, silver matters for India?
India is one of the world’s biggest bullion consumers:
| Commodity | India’s Global Position |
|---|---|
| Gold | Second-largest consumer |
| Silver | Largest buyer |
That means even a temporary disruption in imports can create ripple effects across jewellery stores, bullion traders, and retail markets.
How much gold and silver is stuck?
Trade sources cited in reports said:
- More than five tonnes of gold are currently held at customs
- Around eight tonnes of silver are also awaiting clearance
- Banks are avoiding fresh overseas orders until clarity emerges
This has increased fears of a Supply shortage of gold, silver if delays continue.
Could gold prices rise for Indian buyers?
Yes, that is possible.
When supply tightens and demand remains steady, domestic premiums often move higher. This is especially relevant with Akshaya Tritiya, one of India’s biggest gold-buying festivals, approaching.
What buyers may notice:
- Higher making charges or premiums
- Reduced availability of some jewellery products
- Faster price movement in local bullion markets
What is happening to existing stock?
India’s gold demand fell to 710.9 metric tonnes in 2025, marking a five-year low, according to World Gold Council data.
Because of slower demand last year, markets still had some inventories from earlier imports. However, those stocks are gradually being used up.
Reports also suggest the market is increasingly relying on gold sold through exchange-traded funds (ETFs) witnessing outflows.
Is the government trying to control imports?
Some market participants believe authorities may be cautious about rising imports because of pressure on India’s trade balance.
Higher global prices for:
- Oil
- Gas
- Fertilisers
could raise India’s import bill. In such an environment, slower bullion imports may help contain the trade deficit and support the rupee.
How the Supply shortage of gold, silver can affect the economy?
The bullion market does not operate in isolation. Gold and silver imports influence several parts of the economy:
1. Trade Deficit
India imports most of its bullion needs. Lower imports can reduce the overall trade gap.
2. Currency Movement
A smaller import bill can help support the rupee.
3. Consumer Demand
Higher local prices may delay jewellery purchases.
4. Festival Spending
Festive buying seasons often depend on smooth bullion availability.
What the market wants now?
The biggest demand from the industry is clarity.
A fresh DGFT notification would likely ease customs delays, allow shipments to clear, and help normalise imports. Until then, the risk of a Supply shortage of gold, silver remains a key concern for traders and buyers alike.
What should consumers do now?
If you plan to buy gold or silver soon:
- Track daily prices closely
- Compare premiums across sellers
- Avoid panic buying
- Purchase certified products only
- Watch for policy updates before making large purchases
Final Take
The current Supply shortage of gold, silver concern is less about demand and more about logistics and policy timing. With tonnes of bullion reportedly stuck at customs and banks pausing new orders, the market is entering a sensitive period just ahead of a major festive season.
If approvals come quickly, supply could normalise. If delays continue, Indian buyers may soon feel the impact through tighter availability and higher premiums.
