Gold Rate : Will gold prices drop after the budget? Will the common people get relief?
In recent months, there has been a consistent significant increase in gold prices. Currently, gold has surpassed 160,000 rupees per tola, and silver prices have also reached historic highs. As a result, buying gold has become unaffordable for the common citizen. Customers purchasing gold for weddings, festivals, or investment are facing a major financial setback. In such a situation, all eyes are now on the upcoming central budget, with expectations of a reassuring decision from the government regarding gold prices.
Why are gold and silver prices rising?
Gold prices have increased significantly in the international market. Currently, the price of gold in the global market is nearing 5,000 dollars per ounce, while silver is trading around 100 dollars. According to experts, geopolitical tensions at the global level, war-like situations, interest rate policies in the United States, and the depreciation of the Indian rupee are the main reasons for the price increase. Additionally, the Greenland dispute and the resulting uncertainty are also affecting the international market. The increased attraction towards gold as a safe investment is contributing to the price rise.
Demand to Rationalize Import Duty
Import duty is also a major factor behind the rise in gold prices in the domestic market. Currently, a large amount of import duty is levied on gold. According to Chetan Thadeshwar, MD of Mangalsutra Limited's Shringar House, the government needs to rationalize the import duty on gold in the 2026 budget. Reducing the duty could lead to a decrease in gold prices, directly benefiting consumers. Additionally, this could boost the jewelry industry and help in job creation.
Will the Sovereign Gold Bond (SGB) scheme restart?
Gold is not limited to just jewelry but is an important investment tool. Therefore, there is a demand for the government to restart the Sovereign Gold Bond (SGB) scheme. According to Jashan Arora, director of Master Trust Group, frequent changes in taxes and fees cause sudden fluctuations in gold prices. The SGB scheme provides people with an option to invest without purchasing physical gold. This scheme offered 2.5% annual interest and tax benefits. The scheme was closed in 2024, but now the demand to restart it is gaining momentum.
Demand to Reduce GST
Currently, 3% GST is levied on gold jewelry. Along with this, making charges increase the financial burden on customers. The All India Gem and Jewellery Domestic Council (GJC) has demanded the government to reduce the GST rate to 1.25% or 1.5%. If such a decision is made in the budget, gold prices are likely to decrease to some extent.