The Indian government has announced an increase in customs duties on gold and silver imports to 15%, comprising a 10% basic customs duty and a 5% Agricultural Infrastructure and Development Cess (AIDC). This decision aims to limit foreign purchases and alleviate pressure on the country's foreign exchange reserves. As India is the second-largest market for precious metals, this move is expected to dampen demand, potentially leading to a 10-12% decrease in gold import volumes. The jewellery sector is already facing challenges, with a reported 20% drop in import demand for jewellery due to high prices. Prime Minister Narendra Modi has urged citizens to refrain from purchasing gold for a year to protect foreign exchange reserves. The government emphasizes the importance of recycling existing gold, as approximately 50% of jewellery demand is currently met through the exchange and recycling of old gold. This strategy aims to transform dormant household gold into productive liquidity, reducing reliance on imports and enhancing economic stability.