Rupee Defence: India Doubles Gold, Silver Import Duties To 15%

Government Order And Policy Shift  

According to a government notification, the new structure comprises a 10% basic customs duty and a 5% Agriculture Infrastructure and Development Cess on gold and silver imports, taking the effective rate to 15%. The step marks a reversal of the 2024 cut that had reduced duties to 6% to discourage illicit inflows and support the jewellery industry.  

Impact On Bullion Market And Rupee  

The hike comes after record precious metal imports in 2025 strained foreign exchange reserves and pressured the rupee, one of Asia’s weakest currencies this year. While higher duties could dampen official imports and help narrow the current account deficit, industry players warn that elevated tariffs have historically pushed demand into grey channels.  

What It Means For Consumers And Traders  

Domestic gold and silver prices are likely to move further above global benchmarks as dealers pass on the higher tax burden to end buyers. Banks and nominated agencies may temporarily slow fresh import orders as they reassess demand, inventory and pricing strategies under the new regime. Jewellers are expected to recalibrate festival and wedding-season stock planning, with some already flagging a possible shift toward lighter designs and lower-ticket purchases.  

Key Highlights  

• Duties on gold and silver raised to 15% from 6% to curb imports and protect forex reserves.  
• New structure: 10% basic customs duty plus 5% agriculture infrastructure cess.  
• Move aims to narrow trade and current account deficits and support the rupee.  
• Risk of higher smuggling and grey-market activity flagged by industry participants.  
• Domestic bullion prices likely to rise as premiums over global rates widen.  

Sources: Government notifications, Finance Ministry, Reuters, domestic media reports, bullion industry officials.