India gold jewelry 2012 2
A salesgirl shows a gold necklace to customers at a jewellery showroom in the northern Indian city of Chandigarh. Reuters

India’s $41 billion gold industry plans a 24-hour strike next Monday, as government raids and import restrictions frustrate retailers in what used to be the world’s largest gold-consuming country.

The India Bullion and Jewellers’ Association has asked bullion dealers, jewelers and wholesalers, among others, to shut on March 10, to protest government seizures of allegedly smuggled gold, reports the FT. The association expects 500,000 stores to take part.

Import duties, which rose from 4 percent to 10 percent in 2013, hampered gold imports and led to reported gold shortages late last year, ahead of India’s Diwali holiday season, when gold gifts are exchanged. Official Indian gold imports more than halved to 150 tonnes in the third quarter of 2013 from the prior quarter, after customs restrictions were announced.

India produces little gold, in contrast with rival China, which now ranks as gold’s top consumer and producer.

Gold import rules were intended to contain India’s current account deficit, which hit a record of $37.7 billion in late 2012, wrote HSBC precious metals analyst James Steel in a note on Tuesday. Gold is India’s top import, beating oil in 2012 at $50 billion worth of imports.

“We believe any potential easing in the bullion trade is more likely to occur after the [April and May 2014] elections rather than before the elections,” wrote Steel. “This would likely be announced in measured steps.”

Analysts and industry insiders have speculated that Indian officials could ease import rules by the end of the fiscal year in March, though many say the topic won’t be addressed until after coming elections.

This isn’t the first time India’s gold industry has walked off the job. Gold jewelers staged a strike that lasted more than a fortnight in March 2012, according to MarketWatch.