Govt imposes limits, stricter monitoring on gold imports

Thu May 14 2026

The government on Thursday tightened compliance norms for gold imports under the Advance Authorisation scheme, introducing stricter quantity caps, physical verification requirements and periodic reporting obligations amid heightened scrutiny of bullion imports.

In a notification, the Directorate General of Foreign Trade (DGFT) said Advance Authorisation (AA) for import of gold “shall be issued, subject to a maximum permissible quantity limit of 100 kilograms”. Earlier, there was no limit on gold imports under the Advance Authorisation (AA) scheme—which permits duty-free import of gold for export purposes.

According to a government official, the tighter norms were introduced after import duty on gold was increased to 15%, amid concerns that the scheme could be misused for “price arbitrage”. “There is high probability that the AA scheme may be misused to import large quantities immediately and take price arbitrage,” the official said, requesting not to be named.

The measures include a cap of 100 kg per authorization, mandatory physical inspection of manufacturing facilities for new applicants, a requirement to complete at least 50% export obligation under previous licences before fresh authorizations are issued, and stricter monitoring through fortnightly import-export reports by permit holders and monthly reporting by regional offices. The government on Wednesday raised import tariffs on gold and silver to 15%, reversing the 2024 duty cuts, as the government moved to curb surging precious metal imports, narrow trade deficit and support the rupee amid mounting external pressures. The finance ministry notified the changes through multiple customs notifications on 12 May. The revised rates came into effect on 13 May. According to notifications, the government has increased the basic customs duty on several categories of gold and silver imports to 10% from 5%, while the Agriculture Infrastructure and Development Cess (AIDC) of 5% continues, taking the total effective import tax to 15%.

The DGFT has made physical inspection mandatory for first-time applicants seeking gold import authorizations. According to the notification, “a mandatory physical inspection of the applicant's manufacturing facility shall be undertaken” by the concerned regional authority to verify the “existence, capacity and operational status” of the facility.

In another key change, exporters seeking subsequent gold import authorizations will now have to meet at least 50% of the export obligation under previous licences before fresh permissions are granted. “Any subsequent Advance Authorisation for the import of gold shall be considered for issuance only upon fulfilment of at least 50% of the export obligation prescribed under the preceding Advance Authorisations for gold,” the DGFT said.

The government has also tightened monitoring requirements by mandating fortnightly performance reports from authorisation holders, certified by an independent chartered accountant, covering gold imports and exports undertaken under the scheme. Regional authorities will additionally submit monthly consolidated reports to DGFT headquarters for “centralized monitoring and policy oversight,” according to the notification. The move comes amid growing policy focus on gold imports after India’s bullion import bill surged sharply in recent years, putting pressure on the domestic currency.

Source: https://www.livemint.com/