New Delhi, India — May 13, 2026
Gold and silver prices in India witnessed a dramatic rally on Wednesday after the government sharply increased import duties on precious metals in an effort to curb non-essential imports and manage the country’s rising import bill.
Following the announcement, gold prices surged by ₹8,550 per 10 grams, while silver prices skyrocketed by ₹20,500 per kilogram in local bullion markets.
The sharp jump came immediately after the government raised import duties on gold and silver from 6 percent to 15 percent, triggering strong reactions across commodity markets, jewelry traders, and investor circles.
Gold Crosses ₹1.65 Lakh Per 10 Grams
According to market data from Delhi bullion markets, the price of 99.9 percent pure gold climbed by ₹8,550 to reach ₹1,65,350 per 10 grams.
The previous closing price stood at ₹1,56,800 per 10 grams, meaning gold prices registered a gain of more than 5 percent in a single trading session.
The rally marks one of the sharpest one-day increases in domestic gold prices in recent months and reflects the immediate impact of higher import costs on the Indian bullion market.
Jewelry traders and market analysts said the revised duty structure has significantly increased the landed cost of imported gold, forcing domestic prices sharply upward.
Silver Records Massive ₹20,500 Jump
Silver prices also witnessed an extraordinary spike after the government’s policy move.
In Delhi markets, silver prices rose from ₹2,77,000 per kilogram to ₹2,97,500 per kilogram, registering a massive increase of ₹20,500 in a single day.
Market participants described the rally as one of the strongest reactions seen in India’s silver trade in recent years.
The increase comes amid already elevated global precious metal prices and strong industrial demand for silver in sectors such as electronics, renewable energy, and manufacturing.
Government Raises Import Duty to 15%
The government on Wednesday officially revised customs duties on precious metals:
- Gold import duty increased from 6% to 15%
- Silver import duty increased from 6% to 15%
- Platinum import duty raised from 6.4% to 15.4%
The revised rates came into effect immediately on Wednesday.
The move is part of the government’s broader strategy to reduce non-essential imports and control the rising import bill amid ongoing geopolitical tensions in West Asia.
Officials believe higher import duties may help reduce foreign exchange outflows and discourage excessive purchases of imported luxury commodities.
West Asia Crisis Adds Pressure on India’s Import Bill
The import duty hike comes at a time when global commodity markets remain volatile due to geopolitical tensions in West Asia.
Rising crude oil prices and concerns over shipping routes have already increased pressure on India’s external trade balance.
As one of the world’s largest importers of gold, India faces significant foreign exchange expenditure on precious metal imports every year.
The government appears to be taking preventive measures to reduce pressure on the current account deficit and protect foreign currency reserves during a period of global economic uncertainty.
PM Modi Earlier Called for Lower Gold Imports
The latest policy decision also aligns with previous remarks made by Prime Minister Narendra Modi, who had urged efforts to reduce excessive gold purchases in order to control foreign exchange spending.
Economic policymakers have repeatedly highlighted concerns over India’s high dependence on imported gold, especially during periods of elevated global commodity prices.
Analysts say the new tariff structure is intended not only to raise revenue but also to moderate import demand in the domestic market.
Impact on Consumers and Jewelry Industry
The sharp rise in prices is expected to have a direct impact on jewelry buyers, retailers, and wedding-related purchases across India.
Higher bullion prices could:
- Increase jewelry costs for consumers
- Slow retail demand in the short term
- Affect wedding season buying patterns
- Push some buyers toward lightweight jewelry options
- Increase interest in recycled gold and exchange schemes
Jewelry industry representatives are also expected to seek clarity from the government regarding customs implementation and pricing adjustments.
Investors Turn to Precious Metals Amid Uncertainty
Despite concerns over rising prices, many investors continue viewing gold and silver as safe-haven assets during periods of geopolitical instability and inflation risks.
Financial experts noted that global uncertainty, combined with higher domestic import duties, could keep precious metal prices elevated in the near term.
Some analysts believe investment demand may remain strong even if jewelry consumption slows temporarily due to higher retail prices.
Silver, in particular, is attracting additional attention because of its growing industrial applications alongside its traditional role as a store of value.
Bullion Traders Brace for Volatility
Bullion traders and importers are now preparing for increased market volatility following the duty revision.
Industry experts believe the sharp tariff increase could:
- Change import sourcing patterns
- Increase imports through preferential trade routes
- Boost smuggling risks if price gaps widen significantly
- Affect inventory planning for jewelers and traders
Market participants are also closely watching whether the India-UAE trade agreement could create alternative import channels through Dubai due to lower concessional tariffs available under CEPA arrangements.
Economic Balancing Act Ahead
The government now faces the challenge of balancing inflation management, trade stability, and foreign exchange conservation while minimizing disruptions to the domestic bullion market.
Economists say the move reflects a broader effort to strengthen India’s external financial position during a period of global uncertainty and rising commodity prices.
However, the immediate market reaction shows that higher import duties are already translating into significantly higher prices for consumers and traders alike.
As geopolitical tensions and global commodity volatility continue, precious metal prices in India are expected to remain under close watch in the coming weeks.
