Gold Gets Costlier! Centre Hikes Import Duty to 15% as PM Modi Pushes Cost Cuts; Read Details

The Centre has hiked the import duty on gold and silver to 15%, right after PM Modi called for strict austerity measures. This move aims to protect our foreign exchange reserves and boost the rupee's value. The PM has also asked everyone to cut down on fuel use and encouraged work-from-home.

New Delhi: The central government has hiked the import duty on gold and silver to 15%. This big move comes right after Prime Minister Narendra Modi called for some serious belt-tightening across the country. The new duty is a sharp increase from the earlier 6%. It now includes a 10% basic customs duty and a 5% Agriculture Infrastructure and Development Cess.

The PM's call for austerity and these tough measures come as the country deals with the economic fallout from the conflict in the Middle East.

Government sources say this will help reduce the massive demand for gold in India, which is the world's second-biggest consumer. The main goals are to bring down the trade deficit and strengthen the rupee, which has been taking a beating. However, there's also a worry that this hike, which reverses a tax cut from earlier in 2024, could lead to more gold smuggling.

India imports most of the gold it consumes. Last Sunday, PM Modi had even asked people to stop buying gold jewellery for one year to help save foreign exchange. His appeal came at a time when more people are turning to gold as a safe investment because of poor returns from the stock market. In fact, investments in India's Gold ETFs shot up by 186% in the first quarter of this year, hitting a record 20 metric tonnes.

UP Considers Work-From-Home Order

In Uttar Pradesh, the government is thinking about bringing in a work-from-home order for two days a week. The convoys for the Chief Ministers of UP and Rajasthan will also be trimmed down. In Maharashtra, a study tour for MLAs has been cancelled.

Even the Prime Minister's security convoy will be cut by half. Reports suggest that PM Modi has already given this instruction to the SPG. The main idea behind all this is to cut down fuel consumption as much as possible.

The PM has suggested a period of self-restraint, much like during the COVID-19 pandemic. He urged people to cut down on petrol and diesel use as much as possible and to promote work-from-home. He also asked everyone to postpone foreign trips to save foreign currency and to try things like carpooling. The PM said we need to reduce our dependence on fuel imports. He also advised a 10% cut in edible oil consumption and told people in cities with a metro to use it. He specifically asked families to avoid buying gold for functions for one year.

At a rally in Hyderabad, the Prime Minister said, "Not just dying for the country, but living for it is also patriotism. Show your patriotism by following these instructions." After his speech, there were some rumours about a possible fuel shortage, but the Centre later issued a clarification.