India has sharply raised import duties on gold, silver and platinum from 6% to 15% as part of emergency measures aimed at protecting the economy from rising external-sector risks triggered by the escalating West Asia crisis. As per government sources, the duty revision is a calibrated move to ringfence forex for crude oil, fertilisers and defence as West Asia tensions and the US-Iran war reshape India's external calculus. Platinum duty has been raised from 6.4% to 15.4%, with the move also covering related imports such as dore, coins and findings. Government sources noted that conserving foreign exchange reserves has become a priority amid rising geopolitical risks, with officials arguing that forex resources must be channelled towards essential imports such as crude oil, fertilisers, industrial raw materials, defence equipment, capital goods and critical technologies. According to CNBC TV18, the government views this as part of a preventive and forward-looking approach to external-sector management aimed at reducing vulnerability before external pressures intensify further.
The gems and jewellery industry is facing significant challenges following Prime Minister Narendra Modi's appeal to postpone gold purchases for a year to help conserve foreign exchange amid the West Asia crisis. GJC Chairman Rajesh Rokde warned that the industry, which provides direct and indirect jobs to over a crore people, will come into stress after the prime minister's appeal. As per The Economic Times, GJC Vice Chairman Avinash Gupta stated that gold has always been emotionally and culturally connected to Indian households, but today the nation faces the challenge of balancing gold demand with economic stability. The industry believes that a robust and regulated Gold Monetisation Scheme can become a long-term solution for India, channeling existing gold into the formal economy to reduce imports and ease CAD pressure. According to CNBC TV18, officials believe precious metals, while culturally and financially significant, remain largely consumption- and investment-driven in nature and involve substantial outflows of foreign exchange.
India will not raise import duties on gold and silver despite concerns about rising import bills and dwindling foreign exchange reserves, with government sources on Monday clarifying there are no plans to hike tariffs on gold and silver at this stage. This decision comes after Prime Minister Narendra Modi's appeal on Sunday for people to avoid buying gold for a year to help the country save foreign currency amid the prolonged US-Iran war with Iran. Commerce Ministry sources stated that at present, there are no import restrictions on cards, dismissing speculation around possible curbs on international transactions to contain foreign exchange outflows. A government source told Reuters that the government currently has no plans to increase import duties on gold and silver following PM Modi's recent appeal asking Indians to avoid non-essential gold purchases for a year amid rising crude oil prices and tensions in West Asia. As reported by The Hindu BusinessLine, gold imports currently attract a 6 per cent duty, including 5 per cent basic customs duty (BCD) and 1 per cent agriculture infrastructure and development cess (AIDC). The latest increase effectively reverses the rationalisation undertaken in the Union Budget 2024–25, when duties on gold and silver were reduced from 15% to 6%, and platinum duties were cut from 15.4% to 6.4%.
According to a GTRI analysis reported by The Hindu BusinessLine, India's gold bar imports have risen sharply from $36.5 billion in 2022 to $58.9 billion in 2025. The analysis notes that the Indian PM's appeals to avoid gold purchases for a year in the national interest must be supported as imports are hurting India's foreign exchange reserves and trade balance. However, GTRI recommends that the government review its Free Trade Agreement policies, especially tariff concessions on precious metals offered to Dubai under the India-UAE trade deal, which has significantly contributed to the recent surge in gold imports. As per Choice Wealth Private Limited, India's gold imports are estimated at roughly $58–60 billion in FY2025, among the highest levels ever recorded, with gold imports now accounting for roughly 8–10% of India's total merchandise import bill and contributing nearly one-fifth of the country's trade deficit. India's import bill has remained elevated due to volatile crude oil prices and sustained domestic demand for gold and electronic goods. CNBC TV18 reports that officials believe India, as one of the world's largest crude importers, remains particularly exposed to disruptions arising from ongoing geopolitical tensions in West Asia, with elevated oil prices and freight disruptions potentially inflating the import bill, pressure inflation, and widen the current account deficit.
PM Modi's appeal has already triggered sharp reactions in financial markets, with jewellery-related stocks witnessing selling pressure amid fears of weaker consumer demand during the upcoming wedding and festive season. Economists say gold has become one of India's biggest import concerns after crude oil, especially at a time when Brent crude prices have surged above $105 per barrel amid escalating geopolitical tensions. India imports more than 85% of its crude oil requirements, making the economy highly vulnerable to oil price shocks. The concern is linked to India's current account deficit, which measures the gap between foreign exchange flowing into the country and money flowing out through imports and overseas spending. Higher crude oil and gold imports can widen the current account deficit, pressure the rupee and increase imported inflation. The Economic Survey of the finance ministry has also flagged the need for calibrated measures to manage the current account deficit while ensuring that consumption demand is not adversely impacted. CNBC TV18 reports that the government believes the move sends "a clear signal of prudent economic governance" and demonstrates that India is responding "proactively to emerging external risks through timely, measured, and targeted interventions."
Industry leaders are urging the government to reconsider the decision and instead focus on unlocking existing household gold through a Gold Monetisation Scheme. GJC Chairman Rajesh Rokde emphasized that the solution may not lie only in reducing demand, but also in unlocking the immense value of existing gold through a transparent and regulated Gold Monetisation Scheme (GMS). He warned that this might also lead to revenge buying as seen in the past when people buy more when restricted. GJC Vice Chairman Avinash Gupta stated that instead of idle gold remaining locked in households and lockers, GMS can channel it into the formal economy - reducing imports, easing CAD pressure and strengthening India's financial ecosystem. The industry believes that utilising existing gold more efficiently, transparently and productively is the answer rather than just consuming less gold. CNBC TV18 reports that the government deliberately chose a calibrated duty hike instead of imposing quantitative restrictions such as import quotas, licensing limits, or outright curbs on precious metal imports, believing such an approach allows demand moderation through market pricing mechanisms without disrupting trade flows, supply chains, or consumer access.
