the import restrictions.
About 300,000 to 400,000 artisans from Zaveri Bazaar, India's biggest bullion market, have already moved back to their villages due to a lack of work, according to Bombay Bullion Association director Kumar Jain.
India has a population of 1.2 billion.
NO U-TURN IN SIGHT
Banks may be holding back until they see what a new government does after national elections due by May.
"They won't take a decision on job cuts as of now, but will wait until June next year to take the call after the new government is formed," said a source at a global supplier who is in regular contact with Indian importers.
In the meantime, some banks have opted to transfer personnel to other trading desks rather than sack them.
An employee with a private bank who was recently asked to move from the bullion desk to currency trading said: "We started the trading desk when demand was good, when there were no restrictions, but now the business has lost its charm. So management has taken steps according to the revenue stream."
All five people on the desk have been moved to currencies, this employee said.
Two other private banks, which imported a combined 100 tonnes last year, have redeployed a total of 10 people.
Bank of Nova Scotia is the biggest gold importing bank in India. Private banks such as HDFC Bank and IndusInd Bank and state-run banks also import.
For now, there's no sign of the government backtracking.
The Finance Ministry sent a letter to banks reiterating the rules last week, one banking source said, and three ministry officials said there were no plans to relax the restrictions.
Overseas banks and trading firms that supply to Indian importers have felt the impact and are shifting business elsewhere.
"Once a destination like India is being restricted, of course we will divert all our attention to China," said Bernard Sin, senior vice president of Geneva-based gold dealer MKS SA.
China is set to overtake India as the world's biggest consumer of gold this year, due in part to the curbs in India.