Taking cue from global price trends, the government on Monday reduced the import tariff value of gold to USD 385 per 10 grams.
The import tariff on silver has also been cut to USD 544 per kg.
During last fortnight, the tariff value on imported gold was USD 398 per 10 grams and on silver at USD 567 per kg.
The import tariff value is the base price at which customs duty is determined to prevent under-invoicing. It is revised on a fortnightly basis taking into account global prices.
The Central Board of Excise and Customs have notified the decrease in tariff value on imported gold, according to an official statement.
Gold in London, which normally sets price trend on the domestic front, on Monday was trading at USD 1,185.70 per ounce in the opening session, 0.36 per cent down from the previous close.
In the national capital, gold prices dipped to three-week low of Rs 27,225 per 10 grams, on slackened demand from jewellers amid a weak global trend.
Similarly, silver also remained under selling pressure and traded lower by Rs 175 to Rs 38,400 per kg.
Gold is the second-largest import item for India after petroleum. Higher gold import bill adversely affects the country’s current account deficit (CAD).
The government has been repeatedly asking people to desist from buying gold and instead invest in other saving instruments.