Advance Authorisation Scheme

• 15 May 2026

On 14th May 2026, the government imposed a 100 kg limit on gold imports under the Advance Authorisation (AA) scheme after sharply raising import duties on precious metals.

Key Points

• New Restriction:
  • Gold imports under Advance Authorisation capped at 100 kg.
  • Earlier, there was no quantitative limit.
• About Advance Authorisation Scheme:
  • Allows duty-free import of inputs used in export products.
  • Commonly used by jewellery exporters.
• Regulatory Tightening:
  • Mandatory physical inspection for first-time applicants.
  • Verification of manufacturing facility, capacity, and operations required.
• Export Obligation Condition: New authorisation allowed only after fulfilling 50% export obligation of previous authorisation.
• Monitoring Measures:
  • Fortnightly performance reports mandatory.
  • Reports must be certified by independent chartered accountant.
  • Regional authorities to submit monthly reports to Directorate General of Foreign Trade.
• Reason for Decision:
  • Prevent misuse of duty-free import scheme.
  • Avoid large-scale imports exploiting price arbitrage opportunities.
• Import Duty Hike:
  • Gold and silver import duty raised from 6% to 15%.
  • Platinum duty raised from 6.4% to 15.4%.
• Additional Tax Structure:
  • Basic Customs Duty on gold doubled to 10%.
  • Agriculture Infrastructure and Development Cess (AIDC) raised to 5%.
  • With 3% IGST, total effective duty reaches 18.45%.
• Economic Context:
  • Gold and silver imports rose 26.7% to USD 102.5 billion in FY 2025-26.
  • Precious metals formed 14% of India’s total imports. Measures aimed at reducing foreign exchange outflow amid West Asia crisis.
• Global Position: India is world’s second-largest gold consumer after China.
• Overall Significance:
  • Aims to curb non-essential imports and protect forex reserves.
  • Strengthens monitoring of export-linked duty exemptions.
  • Reflects tighter trade management amid rising import bill pressures.