Mumbai: The gems and jewellery industry is likely to face challenging times ahead following the hike in gold import duty to 15 per cent, from 4 per cent earlier, a move that could spur the grey market, the All India Gems and Jewellery Council (GJC) said on Wednesday.
“Business is now going to become difficult on the back of the Prime Minister’s austerity measures and following the import duty hike in bullion. What the industry fears is that this will give rise to grey market… smuggling is likely to grow, setting up a parallel economy in the country,” GJC chairman Rajesh Rokde told PTI.
Explaining the duty hike, Rokde said, now the import duty that includes Customs Duty, GST and Agricultural Cess will make gold costlier by around Rs 27,000 per 10 grams from the earlier Rs 13,500/10 gm.
He said the GJC has called an all-associations meeting of the industry in Mumbai on Wednesday to mull over the recent policy decisions and decide on further action.
Meanwhile, jewellery retailer Senco Gold and Diamonds MD and CEO Suvankar Sen said the import duty would remain high till the West Asia crisis remains. Moreover, crude oil prices will remain elevated till the time the oil supply chain becomes stable.
“So maybe for around one year it shall stay at these levels. The volumes might get impacted by 10-15 per cent, but value wise it will remain at a higher level. Consumers will buy lighter-weight jewellery,” he added.
The government on Wednesday hiked import duties on gold and silver to 15 per cent from 6 per cent as part of measures to curb inbound shipments of precious metals amid a rising import bill due to the West Asia crisis.
Prime Minister Narendra Modi on Sunday made a clarion call for curbs on gold purchases, along with other austerity measures to save on foreign exchange. The government has hiked the social welfare surcharge (SWS) and the agriculture infrastructure and development cess (AIDC), effective May 13.
The duty hikes will raise the overall customs duty on gold to 15 per cent.
India’s gold imports surged more than 24 per cent to an all-time high of USD 71.98 billion in 2025-26. In volume terms, however, the shipments dipped 4.76 per cent to 721.03 tonnes in 2025-26.
