Gold Duty Up 9%: What It Costs Your SIP Now?

India has raised import duty on gold and silver, making both metals costlier to bring in. This affects jewellery prices, gold ETF premiums, and your SIP returns in gold funds. Here is what every Indian investor needs to know.

Here's what happened: India's import duty on gold and silver has been hiked by 9%, raising the landed cost of both metals significantly for domestic buyers and traders.. Tighter silver import rules are creating supply bottlenecks, pushing up local silver prices and widening premiums on silver ETFs traded on Indian exchanges.. Gold and silver ETFs may temporarily trade at a premium to their actual Net Asset Value as arbitrage between global and local prices becomes harder to close quickly..

What you should do: Check your gold ETF's current premium to NAV on your broker app before buying — a premium above 0.5% means you're overpaying versus the fund's actual gold value.. Avoid panic-buying physical gold jewellery right now; wait 2–4 weeks for jewellers to reprice inventory and for market premiums to stabilise after the duty shock.. Review your gold allocation — if it exceeds 10–15% of your total portfolio, rebalance using Sovereign Gold Bonds (SGBs) instead, which carry no import duty impact and pay 2.5% annual interest..

Sovereign Gold Bonds are completely insulated from import duty hikes — their price is linked to RBI's reference rate, and you earn 2.5% interest per year tax-free on maturity.