The price of gold in India is influenced by a number of factors including global market trends, the strength of the US dollar, demand and supply in the domestic market, and government policies on import and export of gold.
The price of gold in India is typically quoted in terms of the price per 10 grams of 24-karat gold. Here’s a general process for calculating the current price of gold in India:
- Check the current international spot price of gold. This can be found on financial news websites or through a quick internet search.
- Convert the international spot price from US dollars per ounce to Indian rupees per 10 grams. The conversion factor will depend on the current exchange rate between the US dollar and the Indian rupee.
- Add a premium to the international spot price to account for local factors such as import duties, taxes, and other charges. The premium can vary depending on the location, supplier, and form of gold being purchased.
- The final price will also depend on the purity of gold being purchased, with 24-karat gold being the purest and therefore the most expensive. Lower purity gold such as 22-karat or 18-karat will be cheaper.
Here’s a sample calculation table:
| International Gold prices (in US dollars) | Price per ounce | 2700$ |
| Convert and get grams | One ounce equals | 31.1035 Grams |
| Gold price per gram | Price per gram in USD | 2700$ ÷ 31.1035= 86.807 $ |
| USD-INR exchange rate | 87.00 Rupee per USD | |
| Gold price per gram | Price per gram in Indian Rupee | 86.807 x 87= 7552 Rs. |
| Import duty & other taxes | 5% import duty + 1% Agriculture & infrastructure cess | 7552 x 1.06= 8005 Rs |
| GST | 3% | 8005 x 1.03= 8245 Rs. |
Due to custom duty, agriculture and infrastructure cess of 6% and 3% GST, there is a cost escalation when it comes to purchasing gold or gold jewellery in India. The duty prior to BUDGET 2024 used to be very high at 15% & various organisations representing gold dealers and jewellers had expressed concerns that such a vast difference gave rise to lot of gold smuggling into India.
It’s worth noting that the price of gold in India can fluctuate rapidly due to changes in market conditions, and it’s important to consult with a reputable gold dealer or financial advisor before making any major purchases or investments.
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