Govt move aimed at conserving foreign exchange reserves
New Delhi: The government sharply raised import tariffs on gold and silver to 15% from 6% on Wednesday, as it looked to curb non-essential imports and conserve foreign exchange reserves strained by higher oil and fertiliser purchases amid the West Asia conflict.
The hike follows a rare weekend appeal from Prime Minister Narendra Modi to forgo gold purchases alongside unnecessary foreign travel and conserve oil in order to help the domestic currency.
India is the world’s second-largest consumer of precious metals, which has seen a rally in prices in recent months because of an unabated rise in demand, including for investment purposes. Gold is India’s second-largest commodity import after crude oil, and rising purchases have added to foreign-exchange outflows, pressuring the rupee to record lows.
The higher tariffs are expected to push up domestic prices of gold and silver.
Effective May 13, import duty on gold and silver has been increased to 15% from 6%, and that on platinum has been raised to 15.4% from 6.4%. Consequential changes have also been made to other items such as gold/silver dore, coins, findings, etc.
Gold and silver imports jumped 26.7% year-on-year to $102.5 billion in FY2025-26, with their share in total imports rising to 14% from 11.8% in 2024-25.
The duty hike came within days of Prime Minister Narendra Modi’s clarion call for curbs on gold purchases, along with other austerity measures to reduce avoidable foreign exchange expenditure.
Gold imports in India, the world’s second-biggest gold consumer after China, are driven by the jewellery industry demand. Such imports involve a substantial outflow of foreign exchange.
Meanwhile, the rupee touched its lowest-ever closing level of 95.71 against the US dollar on Wednesday.
PM cuts down convoy size, BJP CMs follow suit
New Delhi: Prime Minister Narendra Modi has significantly reduced his convoy size, days after he appealed for cutting down fuel consumption and spending more wisely, prompting several BJP chief ministers and other leaders to adopt similar measures.The Prime Minister’s appeal is not about spending less but spending more wisely by reducing fuel consumption, officials said.
The Prime Minister’s appeal is not about spending less but spending more wisely by avoidable dependence on imported goods and foreign-currency-intensive services, official sources said, stressing that the Modi government is not cutting capital expenditure, welfare spending or subsidies.
A downsizing in the Prime Minister’s convoy was implemented in his recent domestic visits. The reduction was done while maintaining essential security components as per the SPG protocol, the sources said.
Modi’s convoy size was cut in Gujarat and Assam, immediately after his speech in Hyderabad during which he suggested an array of measures for reducing expenditure on imports.
The sources said the Prime Minister also asked for electric vehicles to be included in his convoy, wherever possible, without making new purchases.
Taking a cue from the Prime Minister’s appeal, Uttar Pradesh Chief Minister Yogi Adityanath has directed an immediate 50% reduction in the fleet of vehicles accompanying him and ministers. Adityanath also appealed to people to adopt the Prime Minister’s call for spending more wisely.
Madhya Pradesh Chief Minister Mohan Yadav has announced that he will use a minimum number of vehicles for his convoy and asked his ministerial colleagues to do the same. He also encouraged people to use public transport.
Delhi Chief Minister Rekha Gupta has announced limits on official vehicles used by ministers, MLAs and other public representatives. She also urged Delhi residents to adopt carpooling and make greater use of public transport instead of private vehicles.
Rajasthan Chief Minister Bhajan Lal Sharma similarly directed that his convoy use be minimised. He also instructed all officials and public representatives to adopt similar practices.
The Maharashtra government has directed all ministers to obtain prior approval from Chief Minister Devendra Fadnavis before using aircraft for official travel.
Deputy Chief Minister of Maharashtra Eknath Shinde has switched to an electric vehicle as a step towards energy conservation and sustainable governance. All ministers of Shiv Sena have also been advised to minimise non-essential travel and reduce the number of vehicles used for official movement, official sources said.
