Concerns are mounting within India’s trade and regulatory circles over the alleged misuse of duty-free import channels, with gold reportedly entering the country under the guise of platinum jewellery to bypass higher import duties.
Industry sources indicate that certain importers are declaring gold-based products as platinum jewellery, which attracts significantly lower or zero duty under specific trade provisions. This classification loophole is said to be enabling the inflow of gold without the applicable tax burden, raising red flags among authorities.
The issue has drawn attention from customs officials and policymakers, who are examining discrepancies in import declarations and valuation practices. Preliminary assessments suggest that misclassification of precious metal content is at the core of the problem, allowing traders to exploit differences in tariff structures between gold and platinum.
Experts warn that such practices not only result in revenue losses for the government but also distort the domestic market. Legitimate importers and jewellers complying with duty norms face unfair competition, while unregulated inflows could impact pricing transparency.
The development comes at a time when India maintains strict controls on gold imports to manage its trade deficit and currency stability. Any circumvention of duties through misdeclaration undermines these policy objectives.
Industry bodies have called for tighter scrutiny, including enhanced testing of metal composition, stricter documentation requirements, and closer monitoring of high-risk consignments. There are also suggestions to harmonize duty structures or introduce safeguards to prevent misuse of classification benefits.
As investigations progress, authorities are expected to step up enforcement and plug regulatory gaps to ensure fair trade practices and safeguard government revenues in the precious metals sector.
