The Indian government has made changes to the gold import policy to boost trade with the UAE, according to a local media report.

The Directorate General of Foreign Trade has allowed gold to be imported through India International Bullion Exchange IFSC Limited (IIBX) at a concessional import duty rate under tariff rate quota provisions of the Comprehensive Economic Partnership Agreement (CEPA), The Hindu Business Line newspaper reported.

The CEPA came into effect from May 2022.

The move will facilitate the trade of gold between the two countries and benefit the Indian jewellery industry, Vipul Shah, chairman of the Gem and Jewellery Export Promotion Council, told the newspaper.

“It will reduce transaction costs and enhance the ease of doing business,” he added.

The CEPA provides domestic importers a 1% duty concession on a specified quantity of gold under tariff rate quota provisions.

The UAE was India’s third largest trade partner in 2022-23, with bilateral trade estimated at $76.16 billion.

Saudi Arabia came fourth at $52.72 billion, the newspaper said.

IIBX was established at GIFT City, a special economic zone in the Indian state of Gujarat, in July 2022. It is promoted by India’s market infrastructure institutions such as the National Stock Exchange, INDIA INX, a subsidiary of the Bombay Stock Exchange, National Securities Depository Limited, Central Depository Services Limited and Multi Commodity Exchange of India Limited.

(Writing by Brinda Darasha; editing by Seban Scaria)