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Trade Trends News
13-07-2023
India has restricted the import of pure gold jewelry as the world's second-largest consumer of precious metals attempts to plug loopholes in its trade policies.
A government notification stated that the import of gold items has been moved from the free category to the restricted category. It further added that imports are allowed without any license as per the India-UAE Comprehensive Economic Partnership Agreement.
The Ministry of Commerce did not immediately respond to a request for comment.
The move comes as importers have been taking advantage of policy loopholes to purchase pure gold jewelry from Indonesia over the past few months without paying any import duty.
From April to May 2023, India imported such products worth $112.09 million, with $76.28 million coming from Indonesia.
"Indonesia has never been a supplier of gold jewelry to India, but over the past few months, bullion dealers imported 3-4 tons from Indonesia without paying any import duty," said a Mumbai-based trader at a private bullion importing bank.
India imposes a 15% tax on gold imports.
"Many dealers knew about this loophole, and they were also trying to source from Indonesia. The policy change has now closed this loophole," he said.
The move will help reduce the import of non-essential items.
Now, importers need to obtain government permission to import these gold products.
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