Premiums on physical gold in top consumer China jumped this week amid uncertainty over fresh import quotas, while a rise in demand following a drop in local prices prompted Indian dealers to charge premiums for the first time in nearly four months.

In Shanghai, gold was priced as much as $25 an ounce over the international gold prices, the highest since December 2016. That compares with $8-$16 quoted last week.

The high premiums are predisposed by the lockdown in Shenzhen on COVID flare ups, as well as no news on import quotas being issued that could affect industrial activities, said Bernard Sin, regional director for Greater China at MKS PAMP.

The People's Bank of China controls how much gold enters China via quotas to commercial banks.

"There's less customer interest... so in the Shanghai exchange trading is very thin but the premium is very high," said Peter Fung, head of dealing, Wing Fung Precious Metals.

Hong Kong saw gold sold between flat to $2 premiums.

In India, premiums on gold sales made a comeback this week as a hefty correction in local prices boosted retail demand.

"Demand has improved this week because of price drop. Traders have started quoting premium since imports were down in the past few weeks," said Ashok Jain, proprietor of Mumbai-based wholesaler Chenaji Narsinghji.

Premiums of up to $2 an ounce over official domestic prices — inclusive of the 15% import and 3% sales levies, were charged, up from the last week's discount of $7.

Some jewellers were making purchases for the upcoming festive season, but many were still awaiting a further dip in prices, said a Mumbai-based dealer with a private bullion importing bank.

In Singapore, gold traders charged $1.50-$2.30 over spot prices, unchanged from recent weeks, while in Japan bullion was sold between at par to spot prices to a $0.50 premium.

(Reporting by Bharat Govind Gautam and Eileen Soreng in Bengaluru, Rajendra Jhadav in Mumbai; Editing by Shailesh Kuber)