The Indian government has imposed stricter import regulations on gold and silver, restricting their entry to nominated agencies, qualified jewellers, and valid Tariff Rate Quota (TRQ) holders under the India–UAE Comprehensive Economic Partnership Agreement (CEPA), according to a report by the Economic Times.
These restrictions apply to unwrought, semi-manufactured, and powdered forms of gold and silver, aiming to tighten controls on precious metal imports.
The move follows revelations that some importers exploited customs classification loopholes to bring nearly pure gold from Dubai disguised as platinum alloy. By misdeclaring gold as platinum, importers gained access to lower CEPA import duties.
To curb this, the government has introduced a dedicated harmonised system (HS) code for platinum with 99 percent or higher purity. Only imports meeting this criterion will qualify for duty benefits under CEPA. Other platinum alloys or compositions are excluded.
“This measure follows the Budget announcement to create separate HS codes to ensure that gold imports don’t happen in the name of platinum,” an official said.
HS Code Reform and CEPA Quotas
The FY26 Budget proposed creating distinct HS codes for precious metals including gold dore, silver dore, and platinum to improve import regulation and monitoring while aligning duty structures.
Under CEPA, India permits the import of up to 200 metric tonnes of gold annually from the UAE at a reduced tariff, with a 1 percent concession available through the TRQ mechanism.
Trade Council Advocates Diversification
In February, the Gem and Jewellery Export Promotion Council (GJEPC) urged the Commerce Ministry to partially shift gold imports from Switzerland to the United States to help address India’s trade imbalance. Switzerland currently supplies 35 percent of India’s gold bars.
Similarly, the council proposed shifting silver bar imports from the UK—which supplies 41.54 percent—to the US.
In 2024, India exported $11.58 billion worth of gems and jewellery to the US while importing $5.31 billion, resulting in a $6.27 billion trade surplus. The US accounted for 20.28 percent of India’s exports in this category and 12.99 percent of overall trade.
The GJEPC’s recommendations come amid concerns over potential tariff pressures from the US administration, which has highlighted trade imbalances. The council has also suggested lowering domestic import duties to mitigate possible retaliatory measures.
