Noida, May 13 (APAC Media): Domestic metal stocks surged on Wednesday after the Indian government raised import duties on gold, silver and other precious metals, lifting sentiment across mining and commodity-linked shares amid expectations of improved prospects for local producers.
The government raised import duties on gold and silver to 15% from the earlier 6% in an effort to discourage imports, improve trade balance and support domestic value addition. The decision sparked an immediate reaction in equity markets, with metal counters emerging as top gainers during intraday trade.
“Petrol and diesel have become very expensive across the world. It is the responsibility of all of us to ensure that foreign exchange spent on purchasing petrol and diesel is saved by conserving them. I would urge people to avoid buying gold for weddings for the next one year,” PM Modi said.
Govt Hikes Import Duty on Gold, Silver to 15% to Curb Demand
Hindustan Zinc led the pack, rising around 5–6% intraday to an estimated high near Rs 675–Rs 680 levels before settling with sustained gains by the close. The stock outperformed peers on expectations of improved realisations from silver, which is a key by-product of its zinc-lead mining operations.
Market participants noted that higher domestic silver prices, triggered by import restrictions, are likely to strengthen revenue and operating margins for the company.
Parent entity Vedanta also moved higher by about 3–4%, tracking the rally in Hindustan Zinc and improving the outlook for its metal’s portfolio. The stock benefitted from expectations of higher earnings contribution and potential dividend support from its subsidiary.
According to official data, gold imports rose over 24% to a record USD 71.98 billion in 2025–26, up from USD 58 billion in the previous financial year. The figure stood at USD 45.54 billion in 2023–24 and USD 35 billion in 2022–23, underscoring a sustained and steep rise in demand for the precious metal.
Other metal producers, including NALCO, also recorded gains in the range of 2–4%, as buying interest broadened across the sector. The Nifty Metal index outperformed benchmark indices during the session, reflecting strong sector-wide momentum.
Commodity analysts said the duty hike has effectively widened the domestic-international price gap, making imported metals more expensive and thereby improving competitiveness for local producers.
Silver, in particular, saw sharp gains in domestic futures trading, with prices crossing the Rs 3 lakh per kilogram mark on the Multi Commodity Exchange.
Market experts added that Hindustan Zinc stands as the primary beneficiary of the policy change due to its exposure to silver production, while aluminium and other base metal producers may see indirect benefits from improved sentiment and pricing stability.
Overall, the policy announcement triggered a sharp re-rating of metal stocks, with investors quickly positioning for higher domestic realisations and stronger earnings visibility.
The rally underscored the sensitivity of India’s commodity sector to changes in import duties and trade policy measures.
Disclaimer: Views expressed are those of experts and do not reflect APAC Media. This is for informational purposes only, not financial advice. We are not responsible for investment decisions. Please consult a qualified financial advisor before investing.
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