In a bold move on Tuesday, the Indian government announced significant reductions in customs duties on gold and silver.
The basic customs duty (BCD) on precious metal coins, gold/silver findings, and bars plummeted from 15 percent to 6 percent. For gold and silver dore, it came down from 14.35 percent to 5.35 percent.
This policy shift aims at curtailing smuggling activities, which saw an all-time peak in the numbers of gold seized during the January-October period of 2023.
Today’s Gold Rates: A Snapshot Across Indian Cities
As the market reacted to the news, gold prices on July 25 hovered around Rs 70,000 per 10 grams for 24-carat purity in India. The price of 22-carat gold, preferred for its durability for jewelry, stood at Rs 64,940 per 10 grams.
In major cities like Mumbai, Kolkata, and Hyderabad, the rates were consistent, with slight variations observed in other markets such as Delhi and Chennai.
| CITY | 22 CARAT GOLD RATE TODAY | 24 CARAT GOLD RATE TODAY |
| Delhi | 65,090 | 71,000 |
| Mumbai | 64,940 | 70,850 |
| Ahmedabad | 64,990 | 70,900 |
| Chennai | 65,490 | 71,450 |
| Kolkata | 64,940 | 70,850 |
| Gurugram | 65,090 | 71,000 |
| Lucknow | 65,090 | 71,000 |
| Bengaluru | 64,940 | 70,850 |
| Jaipur | 65,090 | 71,100 |
| Patna | 64,990 | 70,900 |
| Bhubaneshwar | 64,940 | 70,850 |
| Hyderabad | 64,940 | 70,850 |
Silver Prices Also Take the Stage
Silver also saw considerable consumer attention with the price marked at Rs 87,900 per kilogram on Thursday, reflecting a steady interest in the commodity amidst the fluctuations in the precious metals market.
Cultural and Economic Significance of Gold in India
Gold’s role in India extends beyond mere ornamentation. It is a cultural cornerstone, especially during weddings and festivals, impacting overall demand.
Economically, India, as the world’s second-largest consumer of gold, largely fulfills its needs through imports, echoing global price trends while also placing weight on the nation’s currency and trade deficits.
Impact of Duty Cut on Smuggling and Economy
The reduction in customs duty aims to address the loss of over Rs 28,000 crore in government revenue caused by smuggling based on previous year’s imports, according to the think tank GTRI.
Data highlighted the sharp increase in gold smuggling, with seizures up to 3,917.52 kg in 4,798 cases reported just this year, underscoring the gravity of the issue.
Switzerland Continues as the Dominant Source for Imports
Switzerland remains India’s largest gold supplier, claiming about 40 percent of the share, with the UAE and South Africa trailing behind.
The dynamics of these trade relations bear watching as India adjusts its tariffs and policies in response to market and political pressures.
Looking Forward: Traders Keep a Close Eye
Indian traders and investors remain vigilant, keenly watching the evolving narrative of gold’s retail cost as it intertwains with broader economic indicators.
The recent cut in customs duties has rippled through the market, sparking discussions on future implications for investors and the broader economy.
Conclusion
The story of India’s love affair with gold continues to unfold in the context of economic strategy, cultural tradition, and global market influences.
As the government balances revenue loss against attempts to curb smuggling, the impact of these changes will play out in the months to come, offering valuable insights to participants in markets worldwide.
