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India Doubles Gold Import Duties to 15% Amid Rupee Pressure

India, the world's second-largest gold consumer, has raised import duties on gold and silver to 15% from 6%. The increase consists of a 10% basic customs duty and 5% additional tax on precious metal imports.

Prime Minister Narendra Modi recently called on citizens to pause gold purchases for one year, citing rupee weakness from overseas bullion demand. Gold imports surged to an average of 83 tonnes monthly in early 2026 compared to 53 tonnes in 2025, driving first-quarter demand to a record $25 billion.

India's merchandise trade deficit widened to over $330 billion in the fiscal year ending March 2026, up from $280 billion previously. Gold and silver represent nearly 11% of total imports, while crude and petroleum products account for 22%. Economists suggest lower gold imports could reduce current account outflows, though elevated energy costs remain the primary pressure on the rupee.