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Gold duty hike to jeopardise jewellery trade; spur grey market, says GJC
India hiked its gold import duty to 15% from 6% on May 13, 2026, as part of austerity measures amid a West Asia crisis. The move is expected to raise gold costs and could spur a grey market, according to the GJC. Industry and retailers reacted with concerns about reduced volumes and shifts in consumer demand.
Why It Matters
The policy change affects import costs, jewellery retail dynamics, and potential illicit trade activity, with possible long-term effects on consumer behavior and the domestic market.
Timeline
7 Events
Background context: 2025-26 gold imports data
May 13, 2026
India's gold imports surged more than 24% to a record $71.98 billion in 2025-26, while shipments in volume terms declined 4.76% to 721.03 tonnes, as reported in the article.
Senco Gold & Diamonds comments on demand outlook
May 13, 2026
Senco Gold and Diamonds MD and CEO Suvankar Sen said the import duty would remain high while the West Asia crisis persists and crude oil prices stay elevated. He projected volumes could fall about 10-15% but value would stay high, with consumers opting for lighter-weight jewellery.
GJC quantifies cost impact of the duty hike
May 13, 2026
GJC chairman Rajesh Rokde explained that the total import duty, including Customs Duty, GST and Agricultural Cess, would make gold costlier by around ₹27,000 per 10 grams from the earlier ₹13,500 per 10 grams.
GJC warns of grey market and calls industry meeting
May 13, 2026
The All India Gems and Jewellery Council (GJC) said the duty hike could spur a grey market and smuggling, and called an all-associations meeting of the industry in Mumbai to discuss policy decisions and possible actions.
SWS and AIDC hikes take effect
May 13, 2026
The Social Welfare Surcharge (SWS) and the Agriculture Infrastructure and Development Cess (AIDC) were hiked and became effective from May 13, 2026, increasing the overall customs duty on gold to 15%.
Government raises import duty on gold and silver to 15% from 6%
May 13, 2026
The government hiked import duties on gold and silver to 15% from 6% as part of measures to curb inbound shipments amid a rising import bill due to the West Asia crisis.
PM Modi calls for austerity measures including curbs on gold purchases
May 10, 2026
Prime Minister Narendra Modi announced austerity measures to save foreign exchange, including calls for curbs on gold purchases.