Some Indian gold traders are placing bulk, short-term import orders on fears that Prime Minister Narendra Modi might soon add curbs on overseas purchases of the metal to his withdrawal of high-denomination banknotes in his fight against "black money", traders and jewellers said.

India is the world’s second biggest gold buyer, and it is estimated that one-third of its annual demand of up to 1,000 tonnes is paid for in black money — untaxed funds held in secret by citizens in cash that do not appear in any official accounts.