Gold demand crashes 70% in fortnight after India doubles import duty to 15%
Jewellery buying collapsed across India after the May 13 duty hike from 6% to 15% pushed effective tax to 18.45%. Joyalukkas reports 35%+ sales decline; fortnight volumes fell to 7.5 tonnes from 25 tonnes. Retailers see shift to lighter pieces and a surge in old-gold resale, with small unorganised players hit hardest.
What happened
Gold demand in India fell 70% in the fortnight after the government doubled import duty to 15% on May 13. Joyalukkas reports 35%+ decline; jewellers see shift
Key facts
- 70% drop in demand
- import duty 6% to 15%
- 7.5 tonnes vs 25 tonnes
- effective tax 18.45% from 9.18%
- Joyalukkas demand down 35%
- gold at Rs 1.57 lakh per 10g
- Q1 bar/coin demand 62.3 tonnes (+34% YoY)
Why this matters
Distressed small-format jewellers and regional chains become acquisition targets in the next 90 days as the duty shock accelerates consolidation toward organised retail.