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The price of hallmark gold in Nepal dropped from Rs 1,67,200 per tola on Sunday to Rs 1,51,300 per tola on Monday.
Cheaper gold sparks buying frenzy in Nepal. (Representative/AP File)
Gold has become significantly cheaper in Nepal, with prices dropping by Rs 15,900 per tola (11.664 grams). This reduction follows a policy shift by the Nepal government, which halved the customs duty on gold imports in response to changes in India’s gold import tax.
Earlier this year, in its July budget, India lowered the import duty on gold and silver from 15% to 6%, making gold cheaper by about Rs 6,000. Nepal’s government has now taken a similar step, cutting its customs duty on gold from 20% to 10%, leading to a dramatic fall in gold prices in Nepal.
As a result, the price of hallmark gold in Nepal dropped from Rs 1,67,200 per tola on Sunday to Rs 1,51,300 per tola on Monday. This marks a significant drop of Rs 15,900. The Federation of Nepal Gold and Silver Dealers Associations confirmed the new price on Monday, November 25.
What Led to the Price Drop?
The Nepal government’s decision to reduce customs duty came after India’s budget announcement, which made gold more affordable in India and sparked a surge in gold smuggling into Nepal due to the price disparity. In response, Nepal’s government took measures to address the imbalance, which had encouraged illegal trade across the open border between the two countries.
The rise in gold smuggling due to the duty gap was a key concern for authorities. The Federation of Nepal Gold and Silver Dealers Associations had recommended a further reduction in the customs duty to 8%, but the government decided on a 10% rate. This move aims to control illegal trade while still making gold more affordable in Nepal.
Gold Prices: Nepal vs India
Despite the drop in Nepal’s gold prices, gold remains slightly more expensive in Nepal than in India. In India, the price of 10 grams of gold is around Rs 79,595, whereas the equivalent price in Nepal, when converted to Indian rupees, is around Rs 94,366 per tola, or approximately Rs 80,930 for 10 grams.
Thus, while the price reduction in Nepal has made gold more affordable, it is still marginally more expensive than in India. Nonetheless, the price difference has sparked a wave of gold purchases in Nepal, with many consumers buying in bulk in anticipation of further price fluctuations.
