Gold Prices Too High? WILL Govt Jump In & Crush Retail Loot – Finance Ministry's BIG Reveal

The Finance Ministry has clarified that the Centre has no proposal to intervene in or regulate retail prices of gold and silver. Prices of precious metals in India are determined by market forces and are not fixed by the government.

According to the government, domestic prices are influenced mainly by international bullion rates, the rupee–dollar exchange rate, and taxes and import duties. Any rise in global prices is quickly reflected in Indian markets.

The Ministry attributed the sharp rise in gold and silver prices to global uncertainty, including geopolitical tensions, fears of economic slowdown, and strong demand for safe-haven assets. These factors have pushed up international prices.

Responding to concerns raised in Parliament about rising prices, the Ministry said direct price control is not feasible. Instead, the government has focused on indirect relief measures rather than fixing retail prices.

As part of its measures, the government reduced customs duty on gold imports from 15 percent to 6 percent in July 2024. This move helped lower the landed cost of gold and partially eased pressure on domestic prices.

To curb gold imports, the government is promoting alternatives such as:

Sovereign Gold Bonds

Gold Exchange-Traded Funds (ETFs)

Gold Monetisation Scheme

These instruments aim to channel household savings away from physical gold.

While the volume of gold and silver imports has declined over the years, the import bill has risen sharply due to higher global prices. The government said bullion imports are now routed through regulated agencies to improve transparency.