The economics research center GTRI has requested the government to conduct an audit of its FTA policies. This is because Dubai gained tariff concessions on valuable metals within the framework of the India-UAE bilateral trade agreement. This has contributed to the rapid growth of gold imports.

The India-UAE Comprehensive Economic Partnership Agreement (CEPA) was signed in May 2022. As a result of the CEPA, India imposed an import duty of 1 percent below the general import duty for gold imported from the UAE through a TRQ system.

The TRQ began at 120 tons per annum and will be increased to 200 tons by 2027, covering approximately 25 percent of India's gold imports. GTRI founder Ajay Srivastava said that in the 2024 budget, India reduced the general gold import duty from 15 percent to 6 percent.

As a result, gold imported from Dubai actually entered India at only a five percent duty. Since then, imports from Dubai have increased significantly. India's gold bar imports from the UAE increased from $2.9 billion in 2022 to $6.7 billion in 2023 and reached $16.5 billion in 2025.

Before the CEPA came into effect, Dubai's share in India's gold imports was 7.9 percent, which increased to 28 percent in 2025. Srivastava said this trend is concerning because the UAE neither mines gold nor has any major processing activity there.

It appears that a large portion of this trade involves gold being shipped from third countries to India via Dubai to take advantage of India's lower tariffs.

To protect India's trade balance and foreign exchange reserves, GTRI has recommended tightening of origin rules, reviewing concessions on precious metals under FTAs, and excluding gold, silver, platinum, and diamonds from future trade agreements.

During the last financial year 2025-26, India's gold imports declined by 4.76 percent in volume terms to 721.03 tonnes. However, in value terms, they increased by 24 percent to $71.98 billion.