Dubai has become a hotspot for shoppers seeking to invest in gold and precious metal jewellery, with an increasing trend of buyers selling their purchases in other countries, particularly in South Asia. Industry insiders attribute this phenomenon to the trust consumers have in the quality of gold and jewellery sold in Dubai, coupled with the significant disparities in prices compared to other markets.
According to industry executives, shoppers leverage Dubai’s reputation for high-quality gold and jewellery, often capitalizing on the price differentials between Dubai and their home countries. Unlike some nations that impose taxes on gold and jewellery purchases above certain thresholds, Dubai offers tax-free shopping for such items, making it an attractive destination for buyers.
However, travelers must adhere to customs regulations when transporting gold and jewellery across borders. Exceeding the permitted limits could lead to confiscation or imposition of customs duties, depending on individual country policies. For instance, Indian passengers are subject to varying allowances based on gender and residency status.
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Shamlal Ahamed, managing director of international operations at Malabar Gold and Diamonds, highlights that the practice of buying gold in Dubai and selling it in other countries, notably India, is driven by significant price differentials rather than quality variations. Gold prices in Asian markets like India can be up to 15 per cent higher than those in Dubai, presenting a lucrative opportunity for consumers engaged in cross-border transactions.
Recent changes in Indian import duties on precious metals have further incentivized shoppers to explore Dubai’s jewellery market. India’s import duty hike aims to align duties on gold and silver with global standards but has resulted in increased prices for consumers.
Dubai’s jewellery market, known for its stringent quality standards and competitive pricing, continues to attract buyers from South Asian countries and beyond. Tawhid Abdullah, chairman of Dubai Jewellery Group, emphasizes the city’s reputation for offering high-quality jewellery at cost-effective prices, with fixed making charges per gram, unlike markets where charges are calculated as a percentage of the gold price.
Despite fluctuations in global gold rates, Dubai remains a preferred destination for jewellery purchases due to its VAT refund scheme for tourists and adherence to strict quality standards. John Paul Alukkas, managing director of Joyalukkas Group, underscores Dubai’s role as a global hub for authentic and high-quality gold products, attracting discerning buyers worldwide.
As Dubai solidifies its position as a key player in the global gold trade, shoppers continue to flock to the city, drawn by its reputation for excellence and affordability in the jewellery market.
