The Government on Tuesday revised the import duty on gold to 2% of value as against Rs 300 per 10 grams at present, according to reports.
At 2:00 pm (IST), the gold futures on the Multi commodity Exchange (MCX) were quoting at Rs 27,724, up Rs 240 or almost 1%.
Import duty on silver has been altered to 6% of value versus Rs 1,500 per kg at present.
The USD-INR rate also improved slightly post the announcement. The rupee was trading at 50.91 per dollar.
There won’t be much impact on imports, Prithviraj Kothari, president of the Bombay Bullion Association was quoted as saying.
The duty change would translate to about Rs 570 per 10 grams for gold, which is priced internationally in dollars, Kothari was quoted as saying.
Silver import duty could translate into ~ Rs 3,000 per kg at current prices, he said.
The Government increased the duty to boost revenues amid concerns about its swelling budget deficit. Domestic prices of the precious metals are likely to rise.
Gold for February settlement on the Multi Commodity Exchange of India (MCX) jumped as much as 1.1% to Rs 27,778 per 10 grams today.
Silver for March delivery rose more than 2% at Rs 53,361 per kg.
Shares of Indian jewellers slipped with Rajesh Exports losing over 2% at Rs 134.
India's gold imports fell to 875-880 tons last year from 958 tons in 2010.
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