Government restricts certain gold imports to regulate inflow

The government’s Directorate General of Foreign Trade at the Ministry of Commerce and Industry has amended import policy and policy conditions for a number of categories of gold. By changing the import status from ‘free’ to ‘restricted’ on certain categories, the government aims to regulate the inflow of the precious metal. 

“We acknowledge the Indian government’s decision to implement restrictions on certain categories of gold imports,” said the Gem and Jewellery Export Promotion Council’s chairman Vipul Shah, the GJEPC reported on its website. “While this move aims to regulate the inflow of gold, we understand that it may have implications for businesses involved in the gold trade. As an industry, we will closely monitor the impact of these changes and work with the relevant authorities to ensure that jewellery exports stay robust.”
 
The government’s amendment to the import policy was announced on July 12. Affected categories include ‘unstudded’ gold, which is now restricted. However, the rule states an exception for importers with a valid India-UAE Comprehensive Economic Partnership Agreement Tariff Rate Quota. These importers can still bring in gold without an import license. 

Other gold categories which are now restricted for imports include gold articles and other forms of gold. These rules have immediately come into effect. 
 
“The government has curbed imports of gold with specific riders,” said Kama Jewelry’s managing director and former GJEPC chairman Colin Shah. “Imports of gold affect the trade deficit negatively… Heavy gold imports also impact the Indian Rupee. Gold imports from UAE are allowed under CEPA to boost trade relations under the pact. Imports from UAE have been dismal despite the pact.”