Gold and silver imports to India drop 40% to $33.46bn in FY14.
Price-sensitive physical buyers again back in bullion market.
Lower bullion prices could now boost physical demand.
Analysts expect gold to log a little more weakness before it bounces back.
Reserve Bank let five private sector banks to import bullion
Indian importers paying people to smuggle gold in flower pots, mobile phones and body cavities.
Traders await US Federal Reserve's 19 March monetary policy decision.
US Federal Reserve monetary policy decision could impact bullion prices.
Global uncertainties boost bullion's safe-haven status.