- Government sources have given a clear rationale for raising import duties on gold, silver, and platinum
- Move aims to shield India's current account from crude oil and global supply disruptions due to Iran-US war
- PM Modi has urged citizens to defer gold purchases and reduce fuel consumption amid crisis
India has sharply raised import duties on gold, silver and platinum as part of emergency measures aimed at protecting the economy from rising external-sector risks triggered by the escalating West Asia crisis, volatile crude oil prices and disruptions in global shipping routes.
The move reflects growing concern within the government over pressure on India's foreign exchange reserves, inflation and Current Account Deficit (CAD), with policymakers moving to prioritise forex resources for essential imports such as crude oil, fertilisers, defence and capital goods over discretionary precious metal imports.
The Centre has increased import duty on gold and silver from 6% to 15%, while platinum duty has been raised from 6.4% to 15.4%. The move also covers related imports such as dore, coins and findings.
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As one of the world's largest crude oil importers, India remains highly vulnerable to energy shocks. Government sources said sustained volatility in oil markets could inflate the import bill, worsen inflationary pressures and widen the Current Account Deficit (CAD).
Govt sources noted that conserving foreign exchange reserves has become a priority amid rising geopolitical risks. Officials argued forex resources must be channelled towards essential imports such as crude oil, fertilisers, industrial raw materials, defence equipment, capital goods and critical technologies.
In contrast, the government described precious metal imports as largely consumption and investment driven, involving substantial foreign exchange outflows without comparable productive economic impact.
Govt sources stressed the move is not intended to ban imports or hurt consumers, but is a calibrated intervention aimed at moderating avoidable imports through price-based disincentives rather than harsher restrictions.
The measure has also been linked to Prime Minister Narendra Modi's recent calls for economic discipline amid global uncertainty.
Officials pointed out duties were cut sharply in Budget 2024-25 — from 15% to 6% for gold and silver, and from 15.4% to 6.4% for platinum — when external conditions were more stable.
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