The Indian government stunned markets by raising import duties on gold and silver to 15 percent effective immediately on May 13, 2026.
Officials broke down the new tariff into a 10 percent basic customs duty plus a 5 percent Agriculture Infrastructure and Development Cess, replacing the earlier flat 6 percent rate.
The policy shift seeks to rein in gold and silver imports that have surged amid pressures from the Middle East conflict on oil prices, widening India's trade deficit and threatening rupee stability.
| Component | Previous Rate | New Rate |
| Basic Customs Duty | 6% | 10% |
| Agriculture Infrastructure and Development Cess | 0% | 5% |
| Total Import Duty | 6% | 15% |
Prime Minister Narendra Modi called on citizens to cut back on gold purchases to safeguard foreign exchange reserves.
India has raised import duties on gold and silver to 15% as Narendra Modi urges citizens to reduce gold buying to protect foreign exchange reserves.
Attributed to Reuters India Bureau Chief.
Reuters reported the tariff increase citing government orders aimed at curbing imports and supporting the rupee. Bloomberg highlighted how the doubling of tariffs aims to defend the economy from fallout of the Middle East situation.
Gulf News noted the immediate effective date and raised concerns about a possible revival of smuggling activities.
Market analysts expect domestic prices of gold and silver to rise sharply in the coming days as importers pass on the higher costs to consumers and jewelers. Traders in New Delhi reported immediate adjustments in spot prices following the announcement.
Consumers planning weddings or investments in precious metals now face higher costs. Jewelry retailers anticipate reduced demand in the short term as buyers delay purchases.
The move aligns with broader efforts to manage the current account deficit during times of global uncertainty. Industry bodies have called for measures to support local manufacturing of jewelry to offset the impact on exports.
Investors are advised to monitor international prices closely as the duty hike may also influence smuggling routes from neighboring countries.
