The move aims to reduce demand for precious metals and protect India’s foreign exchange reserves amid economic pressures.
India has increased import tariffs on gold and silver to 15% from 6%, combining a 10% basic customs duty with a 5% Agriculture Infrastructure and Development Cess. The decision targets reducing imports to ease pressure on the country’s foreign exchange reserves, which have faced strain due to high demand for precious metals.
Previously, the effective import duty stood at 6%. Market participants had expected the hike after Prime Minister Narendra Modi urged citizens to delay gold purchases and cut non-essential spending. Jewelry-related stocks, including Titan and Kalyan Jewellers, fell as much as 15% this week following the announcement.
The government also imposed a 5% customs duty on gold and silver findings, small components used in jewelry manufacturing. The measures reflect broader efforts to curb imports and stabilize the rupee amid global economic uncertainties.