Gold prices in Dubai have long been recognized as more affordable than in India, a trend that has been particularly evident in light of a recent high-profile gold smuggling case. The arrest of Kannada actress Ranya Rao at Bengaluru airport with 14.2 kg of gold has brought attention to the price differences between the two regions. Rao, the stepdaughter of a senior IPS officer, was apprehended after attempting to smuggle gold bars hidden in her clothing, following multiple trips to Dubai. Her arrest underscores the growing concern over gold smuggling and the price gap between Dubai and India.
Why Is Gold Cheaper in Dubai?
Gold is indeed cheaper in Dubai compared to India for several reasons:
Tax-Free Purchases: Dubai does not impose taxes on gold, allowing buyers to purchase gold at market prices without additional charges.
Absence of Import Duties: Unlike India, Dubai does not levy import duties on gold, which helps keep the overall cost lower for consumers.
Competitive Pricing: Dubai’s gold market is highly competitive, with numerous dealers offering attractive rates to attract buyers, further driving down prices.
Dubai has historically been a major center for gold trading, with its gold markets thriving as key hubs for the collection, sale, and trade of gold.
As of September 2024, the price of 24K gold in Dubai was AED 313.66 per gram (approximately INR 7,138.96 per gram), while in India, the same amount of gold was priced at INR 8,225 per gram, according to Bayut.
India’s Gold Import Duties and Restrictions
In contrast, India has implemented a range of import duties and regulations to manage the economic impact of gold imports. In July 2024, the Indian government reduced the customs duty on gold imports from 15% to approximately 6%. This reduction was aimed at curbing smuggling and boosting legal imports, thereby making gold more affordable for Indian consumers.
Despite this reduction, there are still restrictions on the quantity of gold that can be imported without incurring additional duties. Travelers must adhere to these regulations to avoid legal issues when bringing gold into India.
Duty-Free Allowances for Passengers
Male Passengers: Can bring up to 20 grams of gold, with a value limit of INR 50,000, without paying customs duty.
Female Passengers: Allowed up to 40 grams of gold, with a value limit of INR 100,000, duty-free.
Customs Duty on Excess Quantities
Any quantity exceeding the duty-free limit is subject to customs duties, which vary depending on the amount of gold imported. The reduction in import duties in India led to a significant increase in gold imports. In August 2024, India’s gold imports reached a record $10.06 billion, driven by increased consumer demand ahead of the festive season.
While buying gold in Dubai may be more affordable, it is important to consider the regulations and duties involved when bringing gold into India.
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