In August 2017, India restricted imports of gold and silver items from South Korea to check spurt in the inbound shipments of the precious metals from that country. “South Korea is asking for removal of these restrictions but we have asked them to increase value addition norms,” a government official said.
As part of the restrictions, importers have to obtain a licence from the Directorate General of Foreign Trade (DGFT) for importing gold and silver from South Korea.
The two nations implemented a free trade agreement in January 2010. Under the pact, basic customs duty on gold was eliminated. Further, the 12.5 per cent countervailing duty on gold imports has been subsumed in the Goods and Services Tax. Accordingly, the imports now attract only 3 per cent integrated GST. On the other hand, imports of gold from non-FTA countries attract 10 per cent customs duty. Gems and jewellery exporters too have asked not to ease the restrictions as it would impact their shipments.