The Indian government has increased the import duty on gold and silver to 15% [1].

These measures aim to stabilize the national economy as India prepares for potential shockwaves from the ongoing crisis in West Asia. By limiting the outflow of foreign currency, the administration seeks to shield the domestic market from a prolonged oil price shock and mounting forex pressure [1], [2].

Under the new regulations, the Centre has also imposed a strict limit on duty-free gold imports. Specifically, the government established a maximum limit of 100 kg per licence for imports under the advance-authorisation scheme [2]. This cap is designed to prevent the diversion of imported gold, which has previously strained the country's trade balance.

Prime Minister Narendra Modi's administration is implementing these changes to address a soaring import bill [1]. The move reflects a broader strategy to manage economic volatility caused by regional instability. High gold demand often leads to significant currency outflows, which can weaken the rupee during periods of global market stress.

Officials said the curbs are part of a comprehensive effort to ensure economic resilience. The strategy involves balancing the demand for precious metals with the need to maintain sufficient foreign exchange reserves to fund essential energy imports [1], [2].

“India has increased the import duty on gold and silver to 15%.”

These policy shifts signal India's pivot toward a defensive economic posture. By curbing gold imports, the government is prioritizing the preservation of foreign exchange reserves to ensure energy security. This indicates that the administration views the West Asia crisis not as a temporary disruption, but as a long-term risk to the national trade balance.