Government caps duty-free gold imports at 100 kg under Advance Authorisation scheme

The Government of India has imposed a limit of 100 kilograms on gold imports under the Advance Authorisation Scheme, a move aimed at strengthening monitoring and ensuring better compliance in the jewellery export sector.

In a public notice, the Directorate General of Foreign Trade (DGFT) stated that Advance Authorisation for the import of gold will now be issued subject to a maximum permissible quantity of 100 kg.

New Compliance Measures Introduced

The DGFT has made physical inspection of manufacturing facilities mandatory for all first-time applicants under the scheme. The inspections will verify the operational status and production capacity of jewellery manufacturing units before approval is granted.

The notification further stated that any subsequent Advance Authorisation for gold imports will be issued only after the exporter fulfils at least 50 per cent of the prescribed export obligation.

In addition, the concerned regional authority of the DGFT will submit monthly reports detailing the issuance of Advance Authorisations to ensure closer supervision and transparency.

Earlier Position

Previously, there was no quantitative ceiling on gold imports under the Advance Authorisation Scheme.

The scheme allows duty-free import of raw materials or inputs that are used in the manufacture of export products. In the jewellery sector, exporters could import gold without paying customs duty, provided the imported gold was used for producing jewellery meant for export.

Objective of the Move

The new restrictions are aimed at improving regulatory oversight, preventing misuse of duty-free import provisions, and ensuring that imported gold is genuinely used for export-oriented production.

The measures are also expected to help the government maintain better control over gold imports, which significantly impact India’s trade balance and current account deficit.

About the Advance Authorisation Scheme

The Advance Authorisation Scheme is administered by the Directorate General of Foreign Trade under the Ministry of Commerce and Industry.

The scheme permits duty-free import of inputs that are physically incorporated into export products. It is designed to enhance export competitiveness by reducing input costs for exporters.