Gold importers under the India-UAE free trade agreement have received an extension until September 30, 2026, to utilize their tariff rate quota authorisations for FY 2025-26.
New Delhi, India Jul 2, 2026 ALN: New Delhi, Importers who were granted tariff rate quota authorisation to import gold under the India-UAE free trade agreement during FY 2025-26 have been given more time to use those licences till September 30, according to a government order. This extension is significant for importers as it allows them to manage their gold import activities more flexibly amid changing market conditions.
The India-UAE Comprehensive Partnership Agreement (CEPA), which was implemented in May 2022, marked a pivotal development in trade relations between the two countries. This agreement was designed to enhance cooperation and promote trade by reducing tariffs on a variety of goods, including gold. Under the terms of the CEPA, India agreed to a tariff rate quota (TRQ) that allows for the importation of up to 200 metric tonnes of gold annually from the UAE at a reduced tariff of one percent. This arrangement is particularly beneficial for Indian importers, as gold is a significant commodity in India, both for cultural reasons and as an investment vehicle.
The validity of TRQ authorisations for the import of gold issued under the India-UAE CEPA, specifically for the financial year 2025-26, has been automatically extended until September 30, 2026. The Directorate General of Foreign Trade (DGFT) announced this extension in a public notice, clarifying that no additional application, composition fee, amendment, or endorsement is needed to avail of this automatic extension of TRQ authorisation. This simplification of procedures is expected to ease the burden on importers who may have been struggling to utilize their quotas effectively due to various market dynamics.
Despite the benefits of the CEPA, gold imports from the UAE have seen a decline. In the fiscal year 2025-26, gold imports from the UAE dipped by 9 percent to USD 15.4 billion, down from USD 16.83 billion in the previous fiscal year (2024-25). This decline in dollar value reflects broader trends in the global gold market, which can be influenced by a variety of factors including changes in global demand, shifts in consumer preferences, and fluctuations in gold prices. For context, gold imports from the UAE were valued at USD 7.64 billion in 2022-23, USD 3.08 billion in 2021-22, and USD 5.9 billion in 2020-21. This historical data indicates a fluctuating trend in gold imports that is likely tied to both domestic demand in India and international market conditions.
In contrast, India's total gold imports for the last fiscal year reached approximately USD 72 billion, reflecting a substantial year-on-year increase of 24 percent from USD 58 billion in 2024-25. This increase in overall gold imports may suggest a resurgence in consumer demand for gold in India, which is traditionally a favored asset for investment and gifting, especially during festival seasons and weddings. Festivals such as Diwali and weddings in India often see a spike in gold purchases, further driving demand during specific periods of the year.
The implications of these trade dynamics extend beyond mere numbers. The gold trade is a crucial part of the Indian , influencing not only the jewelry sector but also impacting the balance of payments and foreign exchange reserves. The fluctuations in gold imports can affect the Indian rupee's value against other currencies, which is of particular concern for policymakers. A stronger rupee may make imports cheaper, whereas a weaker rupee could increase the cost of imports, impacting inflation and the overall . The extension of TRQ authorisations may help stabilize some of these fluctuations by providing importers with more time to adjust their strategies according to market conditions.
Moreover, the reduction in gold imports from the UAE could indicate a shift in sourcing strategies among Indian importers, who may be exploring alternative markets or adjusting their purchasing strategies based on price movements and availability. The UAE has historically been a significant supplier of gold to India, and changes in this dynamic could lead to broader implications for trade relations and strategies between the two nations.
In a separate trade notice, the DGFT mentioned it has also sought details from exporters who were issued authorisation to export wheat flour and related items. This indicates a broader trend of regulatory oversight and management of trade quotas across various commodities. The competent authority has decided to undertake a review of the utilisation of the quantities already allocated and assess the requirement for further allocation of any unutilised quotas. This review process highlights the government's efforts to ensure that trade agreements are effectively utilized and that exporters are held accountable for their allocations.
Exporters will be required to submit utilisation certificates issued by a Chartered Accountant, detailing the quantity exported against the allocated authorisation by June 30, 2026. This requirement, along with the submission of Shipping Bill details and copies of valid export contracts or purchase orders, aims to provide a clearer picture of how trade quotas are being utilized and to identify any potential inefficiencies in the system. This level of scrutiny can help improve future trade policies and ensure that both importers and exporters are operating within the framework of the agreements established.
Overall, the extension of the gold import quota licences under the India-UAE trade pact is a strategic move that reflects the complexities of international trade and the need for flexibility in response to market conditions. As both nations continue to navigate the evolving landscape of global trade, agreements like the CEPA will play a crucial role in shaping their futures and strengthening bilateral relations. The ongoing collaboration between India and the UAE, particularly in the context of trade and ties, underscores the importance of such agreements in fostering mutual growth and addressing challenges in a rapidly changing global .
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