India's 15% gold duty hike could slash demand by 60 tonnes, save $2.5B in FY27

Economists from CareEdge, Piramal, and Barclays project India's May 13 gold import duty hike to 15% could cut annual demand by 50-60 tonnes and trim the import bill by $2.5 billion in FY27. However, smuggling risks and rising international prices may blunt CAD relief, with each 1% duty rise estimated to reduce demand by 0.8%.

— FiledWed, 13 May, 2026, 20:43 IST·First seen Wed, 13 May, 2026, 20:40 IST·Source The Hindu BusinessLine

What happened

retail-company · Economists project India's 15% gold import duty hike (effective May 13) could cut demand by 50-60 tonnes and save $2.5 billion in FY27, though

Key facts

  • 60 tonnes demand reduction
  • $2.5 billion savings
  • ₹24,000 crore
  • 15% customs duty
  • 700-800 tonnes annual imports
  • 9% duty hike
  • 0.8% demand cut per 1% duty
  • $6-9 billion lower imports
  • 40 bps import growth reduction per 1% price rise
  • 4% import decline
  • 35% March import drop
  • 120% February volume rise
  • $15 billion FY27 import bill

Why this matters

Widening duty arbitrage revives smuggling and grey-market competition, creating M&A opportunities to consolidate compliant organized retailers gaining share from stressed unorganized players.