New Delhi, May 14 -- Days after Prime Minister Narendra Modi made a clarion call for austerity, the Centre sharply raised import duty on precious metals to save dollars, at a time when the Gulf crisis boosts energy prices, weakens the rupee, and eats into the nation's current account. While economists said the decision could dampen demand and arrest the rupee's fall, others said it may fuel smuggling and impact jobs in the jewellery sector.

The finance ministry increased the total import duty on gold, silver and platinum from 9.18% to 18.45%. The new rate includes 10% basic customs duty, 5% agriculture cess and 3.45% Integrated GST, up from 5%, 1% and 3.18% before. The move signals an effort to conserve forex as costly oil and shipping d...