(Reuters) – India shoved import duty on gold jewelry up by half to 15%, the finance ministry said on Tuesday, setting it higher than raw gold duty in a move directed more at protecting the domestic jewelry commerce than stemming bullion imports.
India imported gold jewelry worth $137.57 million in the four months from April to July this year, a part of general bullion imports, which were $2.9 billion in July solely.
The government has constrained gold imports through assesses including three duty hikes this year to a record 10% and the centered bank has put tight limits on importers that have sharply curtailed provision.
India, the world’s biggest buyer of bullion, had imported a record 162 tonnes in May and creating a headache for the government which is endeavoring to curb a broad present account shortfall and support a weak rupee.
Gold is the large-scale non-essential item in India’s import account but jewelry is a tiny part of the buys.
The hike in import duty on jewelry had been a demand from the commerce to double-check the viability of the domestic jewelry manufacturing, and avoid imports of lower jewelry from Thailand, Malaysia or in another place.