Procedure for Importing Gold into India

Last updated : December 13th, 2022 03:47 pm

Procedure for Importing Gold into India

India is a globally significant market for gold business, but interestingly India does not produce a considerable amount of gold that can meet enormous domestic demands. India stands at the second position in gold import globally, after China. The country imports gold in gold bars, governed by the Reserve Bank of India (RBI).

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Custom Duty on gold

According to the latest Union Budget, The total custom duties on the gold bar and gold doré now stand at 15% and 14.35%, respectively.

• With an additional 3% Goods and Services Tax (GST), consumers will now pay 18.45% in tax for refined gold.
• Similarly, the gold refinery will now be paying 17.78% tax for gold doré compared to 13.39% tax previously.
• Entities Allowed to Import Gold Bars into India
• As per the RBI circular, the import of Gold would be permitted only for entities notified by the Directorate General of Foreign Trade (DGFT). DGFT has permitted the following entities to import gold bars into India.
• Metals and Minerals Trading Corporation Limited (MMTC)
• Handicraft and Handloom Export Corporation (HHEC)
• State Trading Corporation (STC)
• Project and Equipment Corporation of India Limited (PEC)
• STCL Limited
• MSTC Limited
• Diamond India Limited (DIL)
• Gems & Jewellery Export Promotion Council (G&J EPC)
• Star Trading House (only for the Gems & Jewellery sector) or a Premier Trading House
• Any other agency authorized by the Reserve Bank of India (RBI)

Limitations on the Import of gold in India

• The weight of gold (including ornaments) should not increase by 10 kgs per passenger.
• Import of gold in the form of coins and medallions is prohibited.
• Entities are permitted to import gold solely for export and no other purpose.
• All gold imports must be routed through custom-bonded warehouses
• For each consignment of gold bars imported, the importer must submit the report of their utilization and proof of evidence to the central excise office.
• Ornaments studded with stones and pearls are restricted.

Conditions for Import of Gold Bars into India

The following conditions are applicable for all entities to import gold bars into India:

• Import of gold in the form of coins and medallions is prohibited.
• Entities/units in the SEZ and EOUs, Premier, and Star Trading Houses would be permitted to import gold exclusively for exports. These entities will not be permitted to clear imported gold for any purpose other than exports.
• Gold imported against any authorization, such as Advance Authorization/Duty-Free Import Authorization (DFIA), should be utilized for export purposes only, and there can be no diversion for domestic use.
• All gold imports must be routed through customs-bonded warehouses;
• The import of gold dore bars will be permitted only against a license issued by the Directorate General of Foreign Trade;
• Entities or units in the SEZ and EOUs, Premier, and Star Trading Houses would be permitted to procure gold from the refinery of the license holder exclusively for exports only, and these entities would not be permitted to clear such gold for any purpose other than for exports.
• For each consignment of gold dore bars imported, the license holder must submit a report on the utilization of gold dore bars, gold produced after refining, gold issued to exporters, and the proof of export for the goods manufactured and exported by these exporters to the central excise officer.

Which country is the largest gold exporter of India?

In earlier years, the Middle Eastern countries always remained the primary source of India’s gold.

• However, Switzerland, in the last fiscal strengthened its position as India’s most significant import partner because of increasing gold imports from the country and replaced Saudi Arabia to become the 4th largest import partner of India.
• Gold imported from Switzerland accounted for almost half of India’s total gold imports.
• On the other hand, Dubai, the gold city, is also a significant place where India imports gold.