India more than doubles gold import duty

        India has more than doubled the import duties on gold and silver, aiming to boost the rupee exchange rate and alleviate the economic impact brought about by rising energy prices and the conflict in Iran.

　　The rising oil prices are putting pressure on India's domestic currency and foreign exchange reserves.

　　The Indian government has decided to raise the import duties on gold and silver from 6% to 15%. Just a few days ago, Indian Prime Minister Narendra Modi called on the public to cut spending, especially on fuel, overseas travel, and gold, which are the main factors driving up India's import bill.

　　Surendra Mehta, the national secretary of the All India Gem and Jewellery Domestic Council, said, "After the prime minister's statement, the tariff increase was already expected." He expects that the gold demand in India, one of the world's largest gold-consuming countries, will decline by 10% as a result.

　　He said, "Raising the tariff can bring immediate relief to the government. This is the only viable measure to quickly stop the depreciation of the rupee."

　　Goldman Sachs (928.74, -17.62, -1.86%) estimated in a report last October that the total value of gold held by Indian households is nearly $3.8 trillion, almost equivalent to 90% of India's GDP. The international gold price was slightly above $4,000 per ounce last October and has now risen to $4,700 per ounce.

　　Goldman Sachs said in the report that gold, with its properties of value storage, inflation hedging, and risk aversion, has become an indispensable asset for Indian households.

　　Affected by this news, the stock prices of listed jewelers such as Kalyan Jewellers and Thangamayil Jewellery tumbled by more than 5%; while the gold ETFs issued by institutions such as Prudential (101.16, -1.82, -1.77%) of India's ICICI Bank and Nomura India rose by more than 4%.

(Global Market Report)