Govt hikes gold, silver import duty to 15 pc to ease forex pressure
New Delhi, May 13
The government on Wednesday announced a hike in customs duties on gold and silver to 15 per cent from 6 per cent as policymakers move to contain pressure on India's foreign exchange reserves and the external account amid the ongoing West Asia conflict.
Moreover, the revised duty on platinum imports has been raised to 15.4 per cent from 6.4 per cent.
According to official changes, the revised structure imposes a 10 per cent basic customs duty along with a 5 per cent Agriculture Infrastructure and Development Cess (AIDC) on gold and silver imports, taking the effective import tax to 15 per cent.
The move comes as India's import bill remains elevated, with precious metals among the key contributors to higher foreign exchange outflows.
The duty hike is expected to discourage inbound shipments and support macroeconomic stability.
Earlier in the month, Prime Minister Narendra Modi urged citizens to avoid non-essential gold purchases for a year and adopt austerity measures to conserve foreign exchange reserves amid global uncertainty linked to the West Asia crisis.
India is among the world's largest consumers of gold, with demand driven largely by jewellery, investment and festival-related purchases.
Meanwhile, inflows into gold exchange-traded funds (ETFs) surged in April, reflecting continued investor interest in the yellow metal despite higher import costs.
According to data from the Association of Mutual Funds in India (AMFI), gold ETF inflows jumped 34 per cent month-on-month to Rs 3,040 crore in April, compared with Rs 2,265 crore in March.
However, silver ETFs continued to witness sustained outflows, marking the third consecutive month of withdrawals.
AMFI data showed silver ETFs recorded an outflow of Rs 126 crore in April, following outflows of Rs 683 crore in March and Rs 826 crore in February.
— IANS
Reader Comments
From a macroeconomic perspective, this makes sense. India imports over 800 tonnes of gold annually, and with West Asia tensions, we need to shore up reserves. But the timing before wedding season is tough for families already dealing with inflation. Hope this is temporary.
So now gold is 15% more expensive, but govt wants us to buy gold ETFs instead? 😅 AMFI data shows inflows jumped 34% in April! People are smart—they know if physical gold becomes costly, they'll buy digital gold or ETFs. But silver ETFs seeing outflows... that's interesting. Maybe silver lost its shine?
I understand the need to reduce forex outflow, but this feels like penalizing ordinary Indians who see gold as a security net. ₹15,000 per 10 grams extra? For many families, gold is not a luxury—it's savings, it's dowry, it's security. Wish alternatives to control spending were explored first.
Yaar, this is a double-edged sword. On one hand, it will reduce gold smuggling? Unlikely. On the other, it makes the already expensive wedding gold even pricier. But if it helps stabilize the rupee and forex reserves, I'm willing to postpone my gold purchase for now. 🇮🇳 #MakeInIndia
Everyone is talking about gold, but what about platinum? 15.4% duty is steep. Platinum is used in catalytic converters for cars, and in renewable energy tech. This might hurt green energy goals while trying to save forex. Feels like a short-term fix without long-term vision.
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