Gold, silver imports to get costlier as govt hikes customs duty to 15%
Prime Minister Narendra Modi has urged citizens to avoid purchasing gold for the one year in an effort to help conserve the country's foreign exchange reserves. India meets nearly its entire domestic gold demand through imports.
The Centre has increased the import duty levied on gold, silver, and other precious metals to 15%. According to the notifications issued on Tuesday by the Finance Ministry, the revised rates will come into effect from today (May 13). The higher duty will apply to imports of gold, silver, platinum, jewellery findings, and precious metal-related industrial goods.
With the increase in import duty, prices of gold, silver, and platinum are expected to rise significantly across India. The move will make imports of precious metals costlier, directly impacting retail prices in the domestic market.
This comes two days after Prime Minister Narendra Modi urged people to avoid purchasing gold for one year in an effort, as the country's foreign exchange reserves have come under strain due to the West Asia conflict.
10% basic customs duty
The government has imposed a 10% basic customs duty and a 5% Agriculture Infrastructure and Development Cess (AIDC) on gold and silver imports. With this latest increase, the import duty on gold and silver has increased from 6% to 15%.
The primary objective behind the government's decision is to curb the purchase of gold and silver in order to reduce the growing pressure on India's foreign exchange reserves.
In its latest move, the government has also increased the import duty on gold imported from the United Arab Emirates (UAE) under the fixed quota system, which earlier enjoyed concessional duty rates.
Duty to be levied on jewelry components
This notification, issued by the Revenue Department under the Customs Act, amends previous customs notifications issued in 2018 and 2021. This notification also changes the duty rates on jewelry "findings" such as hooks, clasps, clamps, pins, and screw backs, which are used in jewelry making.
Gold and silver components will now be subject to a 5% customs duty, while platinum components will be subject to a 5.4% duty. Additionally, the government has also amended the concessional duty provisions for import of used catalysts or ash containing precious metals that are imported for recovery and recycling.
India meets its gold consumption through imports
Notably, India is the world's second-largest importer of gold after China. In the financial year 2025-26, India's gold imports surged by more than 24 per cent to a record USD 71.98 billion. In comparison, gold imports stood at USD 58 billion in FY25, USD 45.5 billion in FY24, USD 35 billion in FY23, USD 46.1 billion in FY22, and USD 34.62 billion in FY21.
Gold has traditionally been viewed as a safe-haven asset and continues to enjoy strong cultural and emotional appeal among Indian buyers. Retail demand for the precious metal usually peaks during festivals and the wedding season.
According to data from the commerce ministry, gold accounted for nearly 9 per cent of India's total imports in FY26. Switzerland remained the largest supplier with around a 40 per cent share, followed by the United Arab Emirates at about 16 per cent and South Africa at nearly 10 per cent.
Also Read: 'No shortage of petrol, diesel,' assures govt after PM's appeal but calls for efforts to save energy
Also Read: 'Use oil wisely, prioritise WFH, don't buy gold for a year': PM's message amid West Asia conflict