New Delhi, March 6 -- Kannada actor Ranya Rao hit the news after being arrested for alleged gold smuggling at Bengaluru airport on Monday. She was reportedly trying to sneak in 14.8kg of the precious metal from Dubai.

With gold prices having skyrocketed amid global uncertainty, its glitter has caught the fancy of investors globally. But does the financial incentive to smuggle it into India remain too high? Last July, its import duty was slashed from 15% to 6%, reducing the domestic premium on its price that sometimes leads people to covet the difference. That cut was expected to deter smugglers. The practice, however, continues.

Only two weeks ago, the Border Security Force foiled attempts to smuggle 25 gold biscuits into India. A lower...