The Directorate General of Foreign Trade (DGFT), Department of Commerce, Ministry of Commerce and Industry, has announced changes to India’s import policy and policy conditions for specific types of gold. The notification, dated July 12, 2023, and published in the Gazette of India Extraordinary Part – II, Section-3, Sub-Section (ii), denotes a change in import status from “Free” to “Restricted” for particular HS codes relating to gold.
Imports of HS number 71131911, which refers to unstudded gold, will be restricted under the amended regulations. Importers operating under a valid India-UAE Comprehensive Economic Partnership Agreement (CEPA) Tariff Rate Quota (TRQ) have been granted a major exemption. Such importers would be able to freely bring in unstudded gold without the need for an import licence.
“We acknowledge the Indian government’s decision to implement restrictions on certain categories of gold imports,” said Vipul Shah, Chairman of the Gem & Jewellery Export Promotion Council (GJEPC), in response to the changes in the gold import policy. While the goal of this step is to limit gold inflows, we acknowledge that it may have ramifications for enterprises participating in the gold trade. As an industry, we will closely monitor the impact of these reforms and collaborate with the appropriate authorities to ensure that jewellery exports remain robust.”
The other affected HS codes are 71131919 and 71141910, covering other forms of gold and articles respectively. These categories will also now fall under the “Restricted” import policy.
These amendments to the import policy and policy conditions for gold, as stipulated in Chapter 71 of Schedule – I (Import Policy) of ITC (HS) 2022, come into effect immediately.
Colin Shah, MD, Kama Jewelry and Former Chairman of GJEPC, stated, “The government has curbed imports of gold with specific riders. Imports of gold affect the trade deficit negatively. The latest trade at $22 billion was the highest in 5 months. The reduced gold imports will help balance the same. Heavy gold imports also impact the Indian Rupee. Gold imports from UAE are allowed under CEPA to boost trade relations under the pact. Imports from UAE have been dismal despite the pact. Though the steps by the government is to balance the macroeconomics. Gold, as a raw material, should be available at reasonable prices for the gems & jewellery industry to maintain the competitive edge for exports.”