This Year’s Weirdest Gold News

I wrote last week about how pressure is mounting for changes to the gold market in India.

The government there has recently been discouraging gold imports. Through a combination of higher tariffs and banking policies aimed at reducing sales through official channels.

But some bizarre news over the weekend suggests officials may be forced to their rethink their strategy. Soon.

The happenings came from New Delhi. Where local media reported over the weekend that a local businessman sought medical attention at a private hospital to remove a “foreign metal” from his abdomen.

Answering the request, doctors were shocked to find a lot of metal. Specifically, gold.

It turns out the man had swallowed 12 gold “biscuits”, weighing nearly 13 troy ounces. All part of a plan to smuggle the bullion in from Singapore.

The strategy reportedly went awry however, when the fellow was unable to pass the gold. Requiring the emergency surgery that resulted in the discovery by authorities.

This is far from just a shock-value, human interest item. But rather tells us a lot about the push India is under to revamp its gold import rules.

The thing is, the man in question was not a professional smuggler or mafia member. By all accounts, the fellow is a wealthy and successful businessman.

All of which suggests one thing: people here are desperate to obtain bullion.

This makes sense given India’s historic position as the world’s number one gold buyer (even though China passed them for the top spot during the past year). All the more so with the traditional gold-buying holiday of Akshaya Tritiya coming up on May 1.

This is a concern the government will be under pressure to address. All the more so given reports that criminal groups may be increasingly becoming involved with gold smuggling–an end officials have always sought to avoid. (This weekend at the port of Mundra, another 12 kg of illegal gold were seized, hidden amidst cargos of zinc scrap.)

With all these events in motion, we may see officials act to ease import curbs sooner rather than later. Which could be one of the most significant events in the gold market for some time.

Here’s to getting what you need,

Dave Forest

dforest@piercepoints.com / @piercepoints / Facebook

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