The advantage of restricting import of gold to designated agencies is that the regulators can fix monetary limits on import during the transition. The domestic transactions of gold imported through the designated agencies could be more easily tracked and would be channelled for making jewellery for domestic use or export. This would also boost exports substantially.
While the dampening effects of globalization on low inflation in the pre-COVID era were overall deemed modest, the undoing of globalization, alongside the green transition, may well imply rapid and large level effects on the price level. As such, how we adapt to such persistent trade shocks is clearly of high value to central banks.