How to calculate the Gold price using Gold Commex rate, INR rate and Custom Duty?

 

How to Calculate the Gold Price Using Gold COMEX Rate, INR Exchange Rate, and Custom Duty

Gold has always been a vital investment asset and a symbol of wealth, especially in countries like India. But have you ever wondered how the price of gold is actually calculated in India when it's based on international markets? Understanding this process can give investors, traders, and even retail buyers valuable insight into how prices are derived and why they fluctuate.

In this article, we’ll break down how to calculate the gold price in India using three primary components:

1. Gold COMEX Rate (International price)

2. INR-USD Exchange Rate

3. Custom Duty and Taxes

Let’s dive into the step-by-step process and the logic behind each component.

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1. Understanding the Gold COMEX Rate

COMEX (Commodity Exchange) is a division of the Chicago Mercantile Exchange (CME) and is one of the leading global commodity markets where gold is traded.

The COMEX price is quoted in:

• US Dollars per troy ounce

• One troy ounce = 31.1035 grams

This price is the base reference for calculating domestic gold prices in India. Since India imports most of its gold, COMEX serves as the global benchmark.

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2. INR-USD Exchange Rate

Since the COMEX rate is in USD, and Indian gold is sold in INR, the USD to INR exchange rate is critical. A stronger INR leads to a lower gold price in rupee terms (and vice versa).

The exchange rate used is typically:

• The interbank rate or RBI reference rate

• May vary slightly depending on the importer or broker

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3. Duties and Taxes Imposed by the Indian Government

Gold imported into India is subject to multiple layers of taxes:

Component	As of 2025 (subject to change)
Basic Customs Duty (BCD)	10%
Agriculture Infrastructure Cess (AIDC)	2.5%
Social Welfare Surcharge (SWS)	10% of BCD (i.e., 1% of gold value)
GST (on sale, not import)	3% (added at retail stage)

These percentages may vary as per changes in the Union Budget or CBIC notifications.

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Step-by-Step Formula to Calculate Gold Price in India

Let’s go through a step-by-step formula to calculate the approximate Indian landed price of gold per 10 grams using the COMEX price, exchange rate, and custom duties.

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Step 1: Get the COMEX Gold Price

Suppose the COMEX price is USD 2,000 per ounce.

Convert it to price per gram:

$$\text{COMEX Price per gram (USD)} = \frac{2000}{31.1035} \approx 64.30 \text{ USD}$$

Step 2: Convert to INR Using Exchange Rate

Assume the current USD/INR exchange rate is ₹84.50.

$$\text{Gold price per gram in INR} = 64.30 \times 84.50 \approx ₹5,436$$

Step 3: Add Basic Customs Duty (10%)

$$\text{After BCD} = ₹5,436 + (10\% \text{ of } ₹5,436) = ₹5,436 + ₹543.60 = ₹5,979.60$$

Step 4: Add Agriculture Infrastructure Cess (2.5%)

$$\text{After AIDC} = ₹5,979.60 + (2.5\% \text{ of } ₹5,436) = ₹5,979.60 + ₹135.90 = ₹6,115.50$$

Step 5: Add Social Welfare Surcharge (10% of BCD)

SWS is 10% of the Basic Customs Duty:

$$\text{SWS} = 10\% \text{ of } ₹543.60 = ₹54.36$$
$$\text{Total after SWS} = ₹6,115.50 + ₹54.36 = ₹6,169.86 per gram$$

Step 6: Add Importer Margin / Refining Cost (Optional)

Most importers or refiners add a small margin or conversion cost (₹50–₹150/gm), depending on market conditions.

Let’s assume a margin of ₹100:

$$\text{Final Import Price} = ₹6,169.86 + ₹100 = ₹6,269.86 per gram$$

Step 7: Calculate Price per 10 Grams

$$\text{Price per 10 grams} = ₹6,269.86 \times 10 = ₹62,698.60$$

Step 8: Add GST (for Retail Sale)

At the point of retail sale, 3% GST is added to the price:

$$\text{Retail Price} = ₹62,698.60 + (3\% \text{ of } ₹62,698.60) = ₹62,698.60 + ₹1,880.96 \approx ₹64,579.56$$

✅ Final Retail Gold Price: ₹64,579.56 per 10 grams

This is an approximate value. The actual market price may vary slightly due to:

• Importer-specific costs

• Transportation/insurance

• Making charges (for jewelry)

• Local taxes or state-level charges

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Example Summary Table

Component	Value (Per Gram)	Notes
COMEX Price per Gram (USD)	64.30	USD 2,000 per oz
Exchange Rate	₹84.50	INR/USD
INR Price (before tax)	₹5,436	Converted from USD
+ BCD (10%)	₹543.60	10% of ₹5,436
+ AIDC (2.5%)	₹135.90	2.5% of ₹5,436
+ SWS (1%)	₹54.36	10% of BCD
+ Margin	₹100	Varies across refiners
Total Before GST	₹6,269.86	Approx. Import Price per gram
Price for 10 grams	₹62,698.60	Without GST
+ GST (3%)	₹1,880.96	On total amount
Final Retail Price	₹64,579.56	Per 10 grams (approximate)

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Key Takeaways

• COMEX gold price and USD-INR rate are the foundation for calculating Indian gold prices.

• Government-imposed duties can add 13–15% to the base cost.

• Retail buyers also pay 3% GST on the final gold price.

• Jewelers add making charges on top of this, especially for ornaments.

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Conclusion

Calculating the gold price using the COMEX rate, INR exchange rate, and custom duty helps demystify the pricing structure and gives a realistic view of what you’re paying for. Whether you're an investor, a trader, or a buyer of gold jewelry, understanding this calculation equips you to make smarter financial decisions.

If you’d like a live calculator or real-time data from CBIC or COMEX to do this automatically, let me know—I can help build one or guide you to the right tools.