The government on Monday hiked the import tariff value on gold and silver to $428 per 10 grams and $688 per kg, respectively, as global prices rose on safe-haven buying in the wake of geo-political tensions.
During the second fortnight of this month, tariff value on imported gold stood at $411 per 10 grams and silver at $632 per kg.
The import tariff value – base price at which customs duty is determined to prevent under-invoicing -- is revised on a fortnightly basis, taking into account the volatility in global prices.
The hike in tariff value on imported gold and silver has been notified by the Central Board of Excise and Customs, an official statement said.
Global gold prices have firmed up due to the escalating violence in Iraq and Ukraine that has bolstered demand for the precious metal. In London, spot gold prices had hit a two-month high of $1,325.90 per ounce last week.
India's gold imports have declined over 74% to $1.75 billion in April this year due to restrictions imposed by the government on inbound shipments of the precious metal to narrow the current account deficit.
Gold is the second largest import item for India after petroleum. Due to several curbs, the country's total gold and silver imports dropped 40% to $33.46 billion in 2013-14, against $55.79 billion in the previous year.
These curbs include raising the import duty on the metal to 10% and also making it mandatory for traders to export 20% of the imported gold.