Union Budget 2026: From mining focus to export push, key expectations of gold & silver industry

Gold and silver prices are rising steadily day after day. Silver has hit its lifetime high today at Rs 3,04,200 per kg, while gold has also touched a record high of Rs 1,45,500 per 10 grams on MCX.

According to experts, this rally is far from over, and silver could climb even higher in the coming days.

Precious metals experts are sharply eyeing the upcoming budget on February 1, with expectations hoping that the government will address issues of concern to the sector.

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In a conversation with Mrituenjay Kumar Jha, Commodity Editor at Zee Business, experts shared their views on their expectations from the precious metals market and outlined the key demands they have from policymakers.

What are GJEPC’s expectations from the Union Budget 2026?

Kirit Bhansali, Chairman of the Gem & Jewellery Export Promotion Council (GJEPC), shared his expectations and key demands from the upcoming Union Budget, highlighting the challenges faced by the gems and jewellery sector.

Relief on US tariffs and push for reverse job work

Bhansali stated that the jewellery sector's major worry at this time is the effect of the US tariffs, which have cut off exports and brought about a significant drop in sales. To address this, the industry has been demanding permission for reverse job work. He noted that the Finance Minister has been positive about this demand for some time.

He explained that until jewellery exports to the US stabilise and return to normal levels, the industry should be allowed to undertake job work for the domestic market. He also pointed out that there are some customs-related delays in this process, but expressed strong hope that the government will grant permission for reverse job work in this Budget.

Raw material policy and making India a trading hub

The second major demand relates to raw materials, particularly rough diamonds. Bhansali said that despite 95–98 per cent of rough diamonds being manufactured in India, rough diamond trading is still largely routed through Dubai. The key reasons, he said, are Dubai’s efficient customs system and zero taxation.

He added that when rough diamonds are brought into India, they attract a tax of around 2–4 per cent. The industry has therefore demanded a waiver on this levy in the Budget, which would help bring trading activities back to India and strengthen the country’s position as a global trading hub.

Bhansali said the industry is hopeful of positive outcomes from the upcoming Union Budget 2026.

GJEPC’s two key demands from the Union Budget 2026

• Approval for reverse job work in the domestic market.
• Waiver of levy to ease raw material sourcing and boost trade.

What are IBJA’s expectations from the Union Budget 2026?

Prithviraj Kothari, President, IBJA, outlined the key demands the bullion industry has placed before the government ahead of the Union Budget 2026.

Customs duty relief under FTAs and TRQs

Kothari said the first major demand relates to benefits under the Tariff Rate Quota (TRQ) framework, especially agreements such as the Comprehensive Economic Partnership Agreement (CEPA) with the UAE and other Free Trade Agreements (FTAs) signed with multiple countries. He stressed that the 1 per cent customs duty benefit available under these agreements should be passed on fairly.

He explained that Dubai imports around 180 tonnes of gold annually, where the basic customs duty is lower by 1 per cent. In comparison, gold dore bars imported into India enjoy a duty benefit of only 0.65 per cent, which could significantly reduce or even halt dore bar imports into India. To address this imbalance, IBJA has demanded that the duty on dore bar imports be raised to 1.65 per cent.

Second: He said it is linked to the misuse of FTAs across several regions. To solve this, IBJA has proposed that the basic customs duty on gold be reduced from 5 per cent to 3 per cent, ensuring a more level playing field for the domestic industry.

Easing mining rules to boost domestic gold production

Third: The government should focus on gold mining in India. Kothari said that the current rules and regulations governing mines are too stringent and need to be simplified. He added that funds should be sanctioned under RNDA to support mining activities.

He pointed out that India has the potential to produce gold in large quantities domestically, but progress is often stalled due to local issues, regulatory hurdles and environmental clearances. With easier regulations and proper funding support, domestic gold production can be significantly enhanced.

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Key demands of IBJA from the Union Budget 2026

• Extension of 1 per cent customs duty benefit on gold imports from Dubai
• Reduction of basic customs duty from 5 per cent to 3 per cent
• Simplification of rules and regulations for gold mining in India

What are GJC’s expectations from the Union Budget 2026?

Speaking to Zee Business, Rajesh Rokde, Chairman, All India Gem and Jewellery Council (GJC), said jewellers have high expectations from the government, which they believe should both safeguard the industry and support its growth.

Gold monetisation and boosting exports

Rokde said GJC has submitted a comprehensive, end-to-end proposal on the Gold Monetisation Scheme to the government. If implemented effectively, this could reduce gold imports by nearly 50–60 per cent. He said this initiative aligns closely with the Prime Minister’s vision of Atmanirbhar Bharat, especially at a time when the jewellery sector is witnessing a “golden phase”. GJC, he added, is ready to take full responsibility for executing this plan within a proper legal framework, which would significantly bring down imports.

On exports, Rokde said the gems and jewellery industry is worth around Rs 12–13 lakh crore, and there is immense untapped potential. As an apex body, GJC believes many wholesalers and manufacturers can meaningfully contribute to exports if given the right support.

He also highlighted a major concern related to GST refunds for foreign buyers. During peak months such as December and January, overseas buyers visiting India do not get GST refunds at airports, unlike in many other global shopping hubs. If GST refunds are enabled, NRIs and foreign buyers would prefer purchasing jewellery in India instead of Dubai or other countries, providing a major boost to domestic trade.

Ease of buying jewellery and tax-related relief

Another key demand, Rokde said, is the introduction of EMI facilities for jewellery purchases. He noted that allowing customers to buy jewellery on EMI would significantly help the industry flourish and expand its consumer base.

He also pointed out that with gold prices rising sharply, the government should consider extending the tax payment deferment period, which would provide some relief and support to investors and jewellers in managing cash flows.

Rokde said several suggestions have already been submitted to the government, and if these measures are included in Union Budget 2026, it would be a highly positive outcome for the industry.

He further noted that gold in Dubai is currently 1–1.5 per cent more expensive than in India. If import duties are reduced and GST is rationalised (though GST does not fall directly under the Budget), it would significantly strengthen India’s journey towards Atmanirbhar Bharat and enhance the competitiveness of the domestic jewellery market.