Despite the Prime Minister's call to curb gold imports and a sharp increase in customs duty, India's gold imports surged 34% in May 2026 to $3.4 billion, up from $2.5 billion in May 2025. During April-May FY27, gold imports jumped 60% to $9 billion.
In contrast, silver imports witnessed a sharp decline, falling 85% in May and 33% during the April-May period.
Prime Minister Narendra Modi, in May 2026, appealed to citizens to refrain from purchasing gold for a year. Following the appeal, the Ministry of Finance raised the import duty on gold and silver from 6% to 15%.
Trade data released by the Ministry of Commerce on Monday suggests that the appeal and higher customs duties have not significantly slowed gold imports. Elevated gold imports have continued to put pressure on India's foreign exchange resources and the rupee.
A Commerce Ministry official said, "If we minus our dependence on energy goods and precious metals, we are able to grow trade in a manner where we are creating a surplus. It's just that we are not able to create enough surplus to compensate for our energy needs and precious metals."
Meanwhile, India's gems and jewellery exports declined to $4.27 billion during April-May 2026 from $4.55 billion in the corresponding period of the previous year. While exports fell 6.03% in dollar terms, they registered a growth of 3.99% in rupee terms.
The decline was primarily driven by a sharp contraction in plain gold jewellery exports, which fell 40.11% year-on-year to $635.95 million from $1.06 billion in the corresponding period last year.
However, in May alone, gems and jewellery exports rose 7% year-on-year to $2.5 billion.One factual point to double-check before publication: if the customs duty was increased from 6% to 15%, that is a very large policy change and may need verification against the latest Finance Ministry notification, as gold import duties have undergone several revisions in recent years.