Nepal’s gold jewellery consumption fell only 3% in 2024 despite record price hikes, according to the Gold Focus 2025 report by Metals Focus. This modest decline is partly supported by unofficial gold inflows from India, where smuggling of 5 to 6 tonnes annually—mainly in bars—helps meet demand.
The report forecasts a sharper 8% drop in 2025 due to soaring prices and a new 2% luxury tax on gold jewellery sales introduced in July 2025, which will raise total taxes on gold to 12%, higher than India’s combined 9%.
High customs duties in Nepal (20%) compared to India (6%) incentivize smuggling, keeping some gold prices below official bank rates. The expected price rise to $3,800 per ounce internationally could reduce Nepal’s demand further to around 14 tonnes in 2025.
Meanwhile, India’s jewellery consumption declined 2% in 2024 and is forecasted to fall 13% in 2025 amid high prices.
Tej Ratna Shakya, former president of the Federation of Nepal Gold and Silver Dealers Association, criticized the luxury tax as poorly timed, saying it will hurt consumers’ already weakened purchasing power and push buyers to cross-border markets.
Consumer preferences are shifting from 24-carat to the more affordable 22-carat gold amid rising prices, with gold imports in Nepal falling significantly by over 40% in value during the fiscal year 2023-24.
