Govt raises gold, silver import duty to 15% amid rising import bill

The Ministry of Finance on Wednesday, May 13, increased the import duty on gold and silver to 15 per cent from 6 per cent, in a move aimed at curbing non-essential imports and conserving foreign exchange amid mounting global economic pressures linked to the West Asia crisis.
The revised duty structure came into effect on May 13 through an official notification issued by the finance ministry, which raised the social welfare surcharge and the agriculture infrastructure and development cess on imports of precious metals.
The move comes days after Narendra Modi appealed to citizens to postpone gold purchases and adopt austerity measures to reduce pressure on the country’s foreign exchange reserves amid geopolitical tensions in West Asia.
India’s gold imports surged by more than 24 per cent to a record USD 71.98 billion in the financial year 2025–26, even though import volumes fell by 4.76 per cent to 721.03 tonnes, largely due to rising global prices.
Gold prices have climbed sharply over the past year. In the national capital, gold prices rose by Rs 1,500 on Tuesday to Rs 1,56,800 per 10 grams, while silver prices jumped by Rs 12,000 to Rs 2,77,000 per kilogram.
The government had reduced customs duty on gold to 6 per cent in the 2024–25 Union Budget to support the domestic gems and jewellery sector, curb smuggling, and make prices more affordable. However, the latest increase marks a reversal amid concerns over the widening import bill and external sector pressures.
Earlier this week, V. Anantha Nageswaran described the ongoing West Asia crisis as a “live balance of payments stress test”, warning of its potential impact on inflation, the current account deficit, and the exchange rate.
The pressure on the economy has also been reflected in the currency market, with the Indian rupee touching a record low against the US dollar on Tuesday.
India, the world’s second-largest gold consumer after China, relies heavily on imports of precious metals, largely driven by the jewellery industry. The government’s latest move is seen as part of broader efforts to manage foreign exchange outflows as the country also grapples with elevated oil and fertiliser import costs due to the ongoing conflict in West Asia.