India has restricted the import of precious metals like gold, silver, and platinum in unwrought, semi-manufactured, and powdered forms to curb misuse of the India-UAE Comprehensive Economic Partnership Agreement (CEPA).
Why the Curbs Were Introduced?
- To prevent misuse of tariff concessions under CEPA.
- Some importers were allegedly importing 99% pure gold disguised as platinum alloys to avail lower duties.
- The move aligns with the Union Budget 2025–26 announcement to introduce new HS (Harmonised System) codes for better monitoring and regulation.
Key Highlights of New Import Policy
1. Gold Import Rules
Gold purity ≥ 99.5% (HS Codes: 71081210, 71081310) is now Restricted.
Import permitted only through:
- RBI-notified or DGFT-nominated agencies
- Qualified jewellers approved by IFSCA, via the India International Bullion Exchange (IIBX)
- TRQ holders under India-UAE CEPA, via IIBX with delivery through IFSCA-registered vaults in SEZs
Gold dore and scrap gold: Import allowed for licensed refineries with Actual User condition.
Previous HS codes like 71081200 and 71081300 have been deleted for clarity.
2. Silver Import Rules
Silver bars ≥ 99.9% purity (HS code 71069120) now Restricted.
Allowed import channels:
- RBI-notified banks
- DGFT-nominated agencies
- IFSCA-qualified jewellers via IIBX
Semi-manufactured silver (HS codes 71069221, 71069229) remains free, subject to RBI norms.
3. Platinum Import Rules
New specific codes introduced:
- Platinum ≥ 99% purity (HS codes 711011111, 71101121) marked Free
- All other platinum categories now Restricted
Older ambiguous HS codes like 71101110, 71101910 have been deleted
India-UAE CEPA and TRQ System
- India allows 200 metric tonnes of gold imports annually from UAE under 1% tariff concession via TRQ (Tariff Rate Quota).
- Only TRQ holders using designated platforms like IIBX are eligible for this benefit.
Economic Context and Trade Adjustments
GJEPC Recommendations (Feb 2025)
Gem and Jewellery Export Promotion Council (GJEPC) suggested:
- Shifting gold imports from Switzerland (35%) to USA
- Shifting silver imports from UK (41.54%) to USA
Reason: To correct India’s trade imbalance and avoid tariff retaliation from the US
In 2024, India’s gems and jewellery exports to the US: $11.58 billion, imports: $5.31 billion → Surplus of $6.27 billion
Implications for Investors and Jewellers
Government push for:
- Traceable and secure bullion imports
- Use of formal and authorised channels like IIBX
- Curtailing backdoor import routes (e.g., gold as platinum)
Aim to promote transparency, boost formalisation, and align with CEPA rules
New import regulations effective immediately per DGFT notification, with Commerce Ministry approval