MUMBAI, May 13 -- Bears in gold and silver are in for a rude shock after the government raised import duty on bullion to 15% from 6%, a move expected to send prices on the Multi Commodity Exchange (MCX) soaring by more than 9% and potentially lock contracts at upper circuits.

Gold and silver contracts on MCX have a maximum daily price limit of 9% in either direction. If international prices move beyond those levels, the exchange can relax the circuit limits in additional 3% bands.

The government on Wednesday raised import duties on gold and silver as part of efforts to curb precious metals imports amid a swelling import bill triggered by the West Asia crisis.

The duty hike comes days after Prime Minister Narendra Modi urged citizens to...