The Centre has increased import duties on gold and silver from 6% to 15% in a major move aimed at reducing imports, supporting the rupee and protecting foreign exchange reserves amid global economic uncertainty.
The revised tariff structure, which came into effect immediately, includes a 10% basic customs duty along with a 5% Agriculture Infrastructure and Development Cess (AIDC). Import duty on platinum has also been raised to 15.4%.
Following the announcement, domestic bullion markets witnessed a sharp rally. Gold prices surged nearly 10%, climbing to around ₹1.62 lakh per 10 grams in some markets, while silver prices jumped by nearly ₹17,000 per kilogram to touch ₹2.90 lakh per kg. Traders described the move as one of the sharpest single-day increases in domestic bullion prices in recent years.
Market experts said the sudden rise in import duty directly increased the landed cost of precious metals, leading to a spike in retail and futures prices across the country. Gold and silver futures on the Multi Commodity Exchange (MCX) also recorded strong gains during Wednesday’s trade.
The government’s decision comes amid pressure on the rupee due to rising crude oil prices, foreign fund outflows and geopolitical tensions in West Asia. Officials believe reducing imports of non-essential commodities such as gold can help narrow the trade deficit and conserve foreign exchange reserves.
India is among the world’s largest consumers of gold, with demand driven mainly by jewellery purchases, weddings and investment demand. Industry representatives warned that the steep increase in duty could affect jewellery demand in the coming months, especially as global gold prices are already trading near record highs.
Some analysts also cautioned that higher import taxes may encourage unofficial imports and smuggling, which had declined after the government reduced duties in recent years. Jewellers said consumers could delay purchases in anticipation of price corrections or lower taxes in the future.
The duty hike follows recent appeals from Prime Minister Narendra Modi urging citizens to reduce gold purchases temporarily to ease pressure on the economy and external accounts.
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