DGFT Tightens Import Norms For Precious Metals To Curb Duty Evasion

(MENAFN- KNN India) New Delhi, May 20 (KNN) The Directorate General of Foreign Trade (DGFT) has issued a new notification aimed at tightening and streamlining the import regulations for precious metals, in an effort to harmonise customs duties with import policies and close loopholes previously exploited by importers.

DGFT Notification No. 08/2025, released on Monday, revises India's Import Policy Schedule under the ITC (HS) 2022 classification. The changes are in line with the customs tariff amendments announced in the Union Budget 2025, particularly concerning gold, silver, and platinum.

According to the Global Trade Research Initiative (GTRI), the revised regulations are a critical step toward preventing the misuse of lower tariff rates under free trade agreements.

One significant loophole addressed relates to platinum alloys. Under World Customs Organisation (WCO) guidelines, any metal containing as little as 1 per cent platinum could be classified as a platinum alloy.

Importers were reportedly labelling products with up to 99 per cent gold as platinum alloys to benefit from lower duties available under the India-UAE Free Trade Agreement (FTA).

To counter this practice, the government has introduced a specific Harmonised System (HS) code for platinum of 99 per cent purity or more.

Only imports under this category will now qualify for preferential tariffs under the FTA, effectively blocking the use of misclassification to avoid higher duties on gold.

The Budget 2025 had earlier introduced new HS codes for key precious metals, including gold dore, silver dore, and high-purity platinum. The new classification system facilitates better tracking and regulatory control, particularly for semi-processed forms such as dore bars.

GTRI noted that these changes are crucial for ensuring that preferential duties intended for semi-processed imports are not misused.

The notification also updates rules governing the import of gold and silver in various forms. Several outdated HS codes have been deleted or reclassified. In the case of silver, imports of unwrought silver with a purity of 99.9 per cent or more are now restricted.

Such imports are allowed only through nominated agencies or qualified jewellers via the India International Bullion Exchange (IIBX). However, silver bars of similar purity under a newly created HS code remain freely importable, subject to Reserve Bank of India (RBI) guidelines.

For gold, specific unwrought and semi-manufactured forms have either been deleted or reclassified. Imports of gold with 99.5 per cent or higher purity are now subject to restrictions and can be undertaken only through nominated agencies, qualified jewellers via IIBX, or holders of Tariff Rate Quotas (TRQs) under the India-UAE agreement.

Additionally, gold dore imports are permitted only by licensed refineries under the Actual User condition.

The notification is expected to enhance transparency in the precious metals trade, reduce abuse of trade agreements, and align India's import procedures with recent tariff reforms.

(KNN Bureau)

MENAFN20052025000155011030ID1109573420