Driven by record-high international prices and resilient domestic demand, India’s gold imports surged by nearly 29% to reach $69 billion during the first 11 months of the 2025-26 fiscal year (April–February).
According to data from the Commerce Ministry, the import value rose from $53.52 billion in the same period last year, significantly impacting the country’s trade balance and external economic indicators.
1. Key Drivers of the Surge
While import volumes have remained somewhat tempered by the high costs, the value of imports has skyrocketed due to a “perfect storm” of factors:
- Elevated Global Prices: Gold prices in the national capital have been hovering around ₹1,51,500 per 10 grams (inclusive of all taxes). Geopolitical tensions in West Asia and expectations of global interest rate cuts have kept the “safe-haven” asset in high demand.
- Jewellery Demand: Despite the high price tags, the Indian wedding and festive seasons continue to drive robust physical demand for gold ornaments.
- Investment Shifts: Record inflows into Gold-backed ETFs (Exchange Traded Funds) and gold-backed loans have further cemented the metal’s role as a primary financial tool for Indian households.
2. Trade Deficit & CAD Impact
The surge in gold imports is a primary contributor to the widening of India’s merchandise trade deficit.
| Metric | Apr-Feb FY25 | Apr-Feb FY26 | Change |
| Gold Imports | $53.52 Billion | $69.00 Billion | ↑ 28.7% |
| Total Trade Deficit | $261.80 Billion | $310.60 Billion | ↑ 18.6% |
- Current Account Deficit (CAD): The RBI reported that the CAD rose to $13.2 billion (1.3% of GDP) in the December quarter. However, for the full April–December period, the CAD actually moderated to 1% of GDP compared to 1.3% a year ago, helped by strong services exports.
3. Top Import Sources
Switzerland remains the undisputed leader in supplying gold to the Indian market, though other regions are seeing significant growth.
- Switzerland (~40% share): Imports from Switzerland rose 11.57% to $23.5 billion. Notably, February alone saw a staggering 719% year-on-year jump in imports from the country to $2.71 billion.
- UAE (>16% share): Continues to be a key hub for bullion transit and refined gold.
- South Africa (~10% share): Remains a vital source of raw gold ore and doré.
4. Government Response & Import Duties
Despite the widening trade deficit, the Union Budget 2026 (presented in February) chose not to hike import duties, maintaining the structure established in July 2024.
- Current Duty: 6% (comprising 5% Basic Customs Duty + 1% Agriculture Infrastructure and Development Cess).
- New Restrictions: Just last week, the government imposed fresh curbs on all forms of articles made of gold, silver, and platinum to discourage non-essential consumption of finished goods.
- Silver Surge: Alongside gold, silver imports witnessed an even more explosive growth, jumping 143% to $11.43 billion, largely driven by industrial demand in the electronics and EV sectors.
5. Why Volume Matters Less Than Value
Interestingly, while the dollar value is at a record high, the actual tonnage of gold imported has been slightly lower in FY26 compared to previous years. This suggests that the “import bill” is being inflated primarily by global price volatility rather than an unmanageable increase in the physical quantity of gold entering the country.
“Gold accounts for over 5% of India’s total import bill,” a Commerce Ministry official noted. “While it adds pressure to our external balance, it remains an essential pillar of the domestic jewellery industry and a vital store of value for millions of Indian families.”