India Weighs Duty Cut on Gold and Silver Amid Smuggling Concerns
India's government is reconsidering its policy on gold and silver imports due to concerns over smuggling and a thriving grey market. The decision to increase import duties in May this year was aimed at reducing the burden on foreign exchange reserves, but it has had an unintended consequence.
Rajesh Rokde, Chairman of the Gems and Jewelry Council, stated that the high tax rates have failed to achieve their intended purpose, allowing smuggling and illegal trade to flourish instead. The council warned against this outcome when the duty hike was first announced.
Gold prices have already started to soften, with a sharp decline in the futures market due to decreased spot demand. The price of gold has settled at 1,54,236 rupees per 10 grams after falling by 2,045 rupees.