India Gold Imports Forecast Cut as Official Monthly Imports Plummet
Kotak Institutional Equities has reduced its forecast for India's gold imports in FY27 due to a sharp decline in official monthly imports. The firm initially projected USD 88 billion in gold imports, but now sees downside risks based on trends from May onwards.
The recent decline in gold imports is attributed to an increase in import duty from 6% to 15% on May 13, which raised domestic gold prices relative to global prices and may have deterred household purchases. Kotak suggests that the slowdown could be temporary if buyers are waiting for a possible duty cut.
The report also raises the possibility of gold imports being diverted to unofficial channels, which could result in lost customs and goods and services tax revenue for the government. However, it is unclear whether such a shift has occurred.