India Caps Duty-Free Gold Imports At 100 Kg Per Licence Amid Crackdown

The centre has tightened rules for duty-free gold imports under the advance authorisation scheme, capping imports at 100 kilograms per licence as part of a broader effort to curb misuse, reduce excessive imports and ease pressure on foreign exchange reserves.

The revised norms, issued by the Directorate General of Foreign Trade (DGFT), come days after the government raised import duty on gold and silver to 15% from 6% to discourage overseas purchases amid rising oil prices and external account concerns.

What Changes Under The New Rules

Jewellery exporters importing gold duty-free under the advance authorisation scheme will now face stricter compliance requirements. The government has linked fresh import permissions to export performance, making it mandatory for firms to complete at least 50% of export obligations under previous licences before applying for new ones.

First-time applicants will also undergo mandatory physical inspections of their manufacturing facilities by DGFT officials. The inspections are aimed at verifying the existence of units, production capacity and operational status before licences are issued.

In another major change, licence holders must submit fortnightly reports detailing gold imports and exports carried out under the scheme. The reports will need certification from an independent chartered accountant. DGFT regional offices have also been instructed to send monthly monitoring reports to headquarters for centralised oversight.

Why The Government Is Tightening Rules

India is one of the world’s largest consumers of gold and also a major exporter of gold jewellery. Under the advance authorisation scheme, exporters are allowed to import gold without paying duty as long as the metal is used for export-oriented jewellery manufacturing.

Officials believe some imported gold may be getting diverted into the domestic market instead of being used strictly for exports. The tighter rules are aimed at plugging those gaps while keeping a closer watch on import volumes.

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Industry Voices Concern

Some exporters reportedly said the new framework could increase compliance burdens for jewellery manufacturers already dealing with higher import duties. A Mumbai-based exporter said the government appears focused on discouraging gold imports even if it affects jewellery exports.

India’s gold jewellery exports, including plain and studded jewellery, stood at $11.36 billion in FY26, according to data from the Gem and Jewellery Export Promotion Council.

Sources:

Reuters

NDTV