Union Budget 2012: Gold to become costlier

Gold will become costlier as the Finance Minister proposed in his budget to double customs duty on standard gold up to 4% from the current 2%, non- standard gold to 10% from 5%. Silver is to shine more as the FM has fully exempt the excise duty from branded silvery jewellery. Manufacturers and traders give thumbs down to such a move.

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“It is very uneventful budget for the gold buyers. There are large chances that smuggling or illegal importing of gold will happen," reacts Mehul Choksi, chairman of Gitanjali Gems. The growing interest among buyers for gold coins and gold bars will come down slightly, industry experts believe.

The gold import is expected to come down by 20% for this year impacting the gold buying,” says Prithviraj Kothari, president of Bombay Bullion Association.

India imported 933.4 tonnes in 2011, mainly driven by jewellery that accounted for over 500 tonnes.

The industry cheers on removal of excise duty on silver metal. India imported 4,800 metric tons of silver in last year and is expected to import 5,000 metric tons this year.