“We have decided to defer the NFO of our Gold-Silver Passive FoF in light of the broader national conversation around precious metal imports and their impact on the external account. We encourage investors to consider equity and debt mutual funds that channel household savings into productive capacity formation in the Indian economy,” said Navneet Munot, MD and CEO, HDFC AMC.
The development comes after the government raised the effective import duty on gold and silver to 15% from 6%, in a move aimed at containing India’s rising import bill amid elevated crude oil prices, pressure on the rupee and external sector risks linked to the ongoing West Asia crisis.
Effective May 13, the revised duty structure includes a 10% basic customs duty and a 5% Agriculture Infrastructure and Development Cess (AIDC).
The move partially reverses the customs duty reduction announced in the 2024-25 Union Budget, when import duties on gold were lowered to support the gems and jewellery sector, reduce domestic prices and curb smuggling.
The government’s latest policy action follows concerns over rising non-essential imports at a time when India is grappling with higher oil and fertiliser import costs. India imports most of the gold it consumes and remains heavily dependent on imported crude oil and LPG.
Prime Minister Narendra Modi recently urged citizens to postpone gold purchases, reduce fuel consumption and avoid unnecessary foreign travel to help conserve foreign exchange reserves as oil prices remain elevated.
India’s gold imports rose more than 24% to a record $71.98 billion in FY26, driven largely by higher global gold prices despite lower import volumes. The rupee also touched a record low against the US dollar this week, adding to concerns around the current account deficit and balance of payments.
First Published: May 14, 2026 9:28 AM IST
