With gold smuggling surging in recent times, import of the yellow metal from the legal channel has plunged 77 percent in the first four months of the current fiscal. Major importers--commercial banks--have found few takers for the precious metal that they have brought in.

For the first time in eight years, silver import has topped gold import. According to Nepal Rastra Bank, silver import has grown by 202.8 percent. NRB’s macro-economic report shows gold import in the first four fiscal months stood at just Rs 1.41 billion while silver imports were worth Rs 10.75 billion. This makes silver import seven times that of gold from the formal channel reports e-kantipur online.

Bankers said they were receiving hardly any applications from bullion traders to buy gold in the past six months. Commercial banks that have the sole authority to import gold for resale have stopped importing bullion of late.

Gold traders also admit the fact. Manish Lal Pradhan, president of the Gems and Jewellery Association of Nepal, said gold smuggling is natural amid high duty on import and while market has abundant supply of smuggled gold at a cheaper rate.

The recent cases of seizure of smuggled gold in large quantities also suggest that gold smuggling is on rise. In the biggest haul this fiscal, police confiscated 23 kg gold worth more than Rs 100 million from Jagati, Bhaktapur, on December 15. Also foiled was the illegal import of 15 kg gold at Bhagwati Bahal in Naxal on December 6.

 “The route is Hong Kong-Lhasha-Tatopani,” said a senior police official. Nepal’s sole international airport, TIA, is another transit for gold smuggling. “We are doing our best to crack down on smugglers,” said Deputy Inspector General Madhav Joshi, spokesman for Nepal Police.

For the huge silver import, however, authorities have no specific answer. There is no quantitative restriction on silver import while the daily import quota for gold is 15 kg.

Bullion traders do not believe that silver import may have come as replacement for gold. Traders agree that the demand for silver is growing. Silver is imported also for ornaments that are exported.