Govt will open special window to allow import of 140 mt gold from UAE at concessional rate

Gold imports: The Centre has decided to open a fresh window for import of 140 MT of gold by manufacturers and traders of the precious metal from the UAE at a concessional rate under the India-UAE Comprehensive Economic Partnership Agreement (CEPA). This would be for the financial year 2023-24.  

Gold tariff rate quota (TRQ) will be allocated to old and new applicants as per the revised simpler eligibility norms and lesser compliance burden for Indian importers, DGFT Santosh Sarangi said on Thursday. 

The CEPA agreement is in force since May 1 last year. As per the agreement, India can import 140 MT in 2023-24 at a one per cent duty concession on the applied Most Favoured Nation (MFN) rate, which is 15 per cent. 

As per the bilateral trade pact, there is no revenue loss on account of imports under the quota system after changes were made to the eligibility norms. 

In May-March 2022-23, out of 110 MTs TRQ of gold allocated, only 8.1 MT was imported. Following this, the UAE requested India to remove restrictive criteria such allocation of Gold to only jewellery manufacturers and to allow all importers to be eligible for availing Gold TRQ. India’s total gold imports shrank 24 per cent on-year in FY23 to $35 billion. 

“Considering the strong trade partnership between India and UAE as well as to uphold the spirit of the Trade Agreement, the matter was considered by the government and the DOR (department of revenue) Notification dated 31.03.2023 was issued removing the Jewellery manufacturer criteria,” Sarangi said. 

Under the trade deal between UAE and India, which was implemented in May 2022, UAE offered immediate zero-duty market access for the export of Gold Jewellery from India, in exchange for Tariff Rate Quota for Gold. 

The TRQ increased from 110 MTs in FY23, 140 MTs in FY24 and gradually to a maximum of 200 MT over five years, with only 1 per cent duty concession. 

The Gold TRQ would be allocated to all applicants both 78 old and new applicants as per the revised guidelines. The DGFT said the fresh application process is not going to materially benefit a group or section of applicants. 

As per the earlier notification,78 applications from manufacturers were received now but the fresh window will be open for all those who have Importer Exporter Code (IEC). 

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