Lantern Mining, the China-based gold producer says that India’s efforts to control gold imports has led to premiums of more than $160 per ounce.
China., March 3, 2014 - (PressReleasePoint) - Management at Lantern Mining say that draconian measures introduced by the Indian government to clamp down on illegal gold smuggling have led to premiums of as much as $160 over the London Gold Price Fix being demanded for an ounce.
India is the world’s second largest consumer of gold behind China and efforts by the government to reduce its burgeoning trade deficit have led to an acute shortage of gold in the physical market.
A Lantern Mining source said, “After the rupee’s sharp slide last year, many Indians decided to buy more gold as a way of preserving their money’s purchasing power. This has led to shortages in the physical market after the government imposed import restrictions so, consequently, smuggling has taken off in a big way in order to satisfy this demand.”
The government is now conducting physical checks of gold stock at wholesalers to make sure that they match up with the amounts officially imported by banks and state-backed traders.
They match the numbers on the gold bars with those on their manifests and if they do not match up, the gold is seized.
“This kind of crackdown and restriction on gold imports serves to illustrate what can happen when people begin to realize that the value of the money in their pockets is being eroded by forces beyond their control. We intend to stand by our commitment to increasing gold production at the most cost effective prices in order to satisfy demand both here at home in China and abroad,” said the Lantern Mining source.
Li Jun Lei
Jinhua Building96 Beijing RoadGuandu, Kunming,Yunnan, R.O.China. China
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