How are gold prices in India decided?
Gold is initially priced in US dollars. As India imports most of its gold requirement, the exchange rate and various duties further influence the gold price in India. If the US dollar strengthens against the Indian rupee, gold prices in India go up and vice versa. After conversion in the Indian rupee, gold prices are then adjusted to factor in the impact of various duties. Gold attracts a basic customs duty, agriculture and infrastructure cess and social welfare surcharge (on assessable value) to arrive at the landed cost. Goods and service tax is also levied on it to arrive at the cost to consumer.