Why did Indian jewellery stocks fall sharply after Prime Minister Modi's comments on gold?

Indian jewellery stocks fell 6% to 9% because Modi's call to avoid gold purchases for a year—aimed at protecting foreign exchange reserves—sparked fears of a sharp increase in gold import duties, especially amid worsening balance-of-payments pressures from surging oil prices and rupee depreciation.

What is the current status of India's gold import duty policy, according to official sources cited in the article?

A government source stated on Monday that India has no plans to raise duties on gold and silver imports, despite industry fears of a reversal of the 2024 cut—from 15% to 6%—and concerns that duties could be raised even higher than in recent years.

Gold Comments by India's Modi, Oil Shock Stoke Tariff Fears; Jewellery Stocks Slide

May 11, 2026

Indian PM Modi's advice to avoid gold purchases amid rising oil prices triggered tariff fears, sending jewellery stocks lower. Officials denied duty hikes, yet the energy crisis continues to strain India's balance of payments and currency value.

reuters

2026-05-11

Gold Comments by India's Modi, Oil Shock Stoke Tariff Fears; Jewellery Stocks Slide

2026-05-12

Modi’s Belt-Tightening Push Raises Pessimism Around India Stocks

2026-05-15

India Signs Agreements with UAE on Defence and Energy During Modi Visit

2026-09-18

US Sanctions Bill on Russian Oil Imports Puts India's Modi in a Bind

Gold Comments by India's Modi, Oil Shock Stoke Tariff Fears; Jewellery Stocks Slide

FAQ