Gold has long been regarded as a safe haven asset worldwide, and recent controversies—such as the gold smuggling allegations involving Kannada actress Ranya Rao—have drawn attention to the noticeable price differences between Dubai and India. Here’s a closer look at what drives this gap.
Dubai: A Tax-Free Gold Hub
In Dubai, gold is sold without the burden of taxes or import duties. This tax-free environment makes the city a major trading center where multiple sellers fiercely compete, ensuring that customers can purchase gold at market-driven, lower prices. For instance, as of March 10, 2024, 24K gold in Dubai is priced at AED 351 per gram, which is approximately Rs 8,318.70 per gram, given an exchange rate of 1 AED = 23.70 INR.
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India: Heavy Duties and Import Restrictions
Conversely, India imposes a custom duty of 6% on it, which adds to the overall cost for buyers. These duties are part of government efforts to curb gold imports, manage the trade deficit, and encourage investment in financial gold products such as Sovereign Gold Bonds. Consequently, as of the same date, the price of 24K gold in India stood at around Rs 8,782 per gram. Additionally, strict regulations limit the amount of gold that can be brought into the country without incurring extra taxes, further impacting prices.
Bringing Gold from Dubai to India
Travelers interested in capitalizing on Dubai’s lower gold prices should be aware of the duty-free import limits when bringing it into India. Female passengers can import up to 40 grams of gold duty-free, with a value cap of Rs 1,00,000, while male passengers are allowed only 20 grams under a Rs 50,000 limit. Exceeding these thresholds results in additional taxes proportionate to the excess amount.
