Dubai vs Mumbai Gold Buying: Who Actually Wins on Making Charges?

Introduction

When you compare buying gold in Dubai and Mumbai, making charges are often the deciding factor. Making charges are the fees charged to turn raw gold into wearable jewelry. They vary by city, store, design complexity, and local taxes. This article breaks down what making charges are, why they differ between Dubai and Mumbai, and who typically comes out ahead — with clear examples and practical tips.

What “making charges” actually cover

Making charges pay for labor, design work, finishing, stone-setting, and often a margin for the jeweler. They are not the same as wastage (metal lost during production) or hallmarking fees, although some shops include those under the same label. Because they are a service fee rather than metal cost, they are set by the retailer and can be fixed per gram, a percentage of the gold value, or a flat amount for the piece.

Why Dubai and Mumbai differ

• Market structure and volume: Dubai is a major global trading hub. High volume and lots of competition push down premiums and making charges on simple pieces such as 22ct chains and plain bangles.
• Design demand: Mumbai has a huge demand for traditional Indian work — Kundan, Jadau, heavy filigree and temple jewelry. Those require more skilled labor and time, so making charges rise to reflect that complexity.
• Labor and overhead: Local labor costs, showroom expenses, and brand positioning matter. A luxury Mumbai boutique will charge higher making fees than a local craftsman who negotiates lower rates. Same in Dubai: branded stores in malls charge more than souk traders.
• Taxes and regulations: Taxes on jewelry and tax treatment of making charges vary by country. These affect the final consumer price even if the raw making fee is low. Also, import duties or allowances when carrying jewelry across borders change the effective saving.
• Purity and alloys: Common Indian jewelry is 22ct (91.6% gold). Dubai tends to sell 22ct and 24ct (99.9%) bullion. Different purities change metal value and sometimes the making charge basis (per gram/net weight vs per piece).

Concrete example — how making charges change the bill

These numbers are illustrative to show relative impact. Assume 24ct spot price is $60 per gram. For 22ct jewelry, the pure-gold value per gram is 22/24 × $60 = $55 per gram. For a 10 gram 22ct necklace:

• Metal value = 10 g × $55 = $550.
• Typical Dubai making charge (simple chain) = about 2–4% of metal value. At 3%, making = $16.50.
• Typical Mumbai making charge for a simple chain = about 8–12% of metal value. At 10%, making = $55.
• Final price difference (making only) = $55 − $16.50 = $38.50 for this 10 g example.

Why this matters: for plain, mass-produced items the making charge gap can be significant in favor of Dubai. For ornate pieces, Mumbai making charges can rise to 20%–50% or be quoted as INR per gram (for example Rs 200–Rs 1,000 per gram), reflecting hours of skilled work and stone setting.

When Mumbai can beat Dubai

• Specialized Indian work: Jadau and Kundan pieces are made by artisans in India. Dubai sellers either import these (raising cost) or cannot match the same craftsmanship at the same price. For these, Mumbai can offer better value or unique availability.
• Negotiation and local relationships: Long-standing Mumbai customers can get lower making charges from neighborhood jewelers. Similarly, small independent workshops may undercut mall stores.
• After-sales buyback: Some Mumbai shops offer favorable buyback policies for their own designs. If you plan to resell to the same shop, the effective cost over ownership can be lower despite higher upfront making charges.

Hidden factors that change the “winner”

• Taxes and duties: Import duties, GST/VAT treatment, and documentation rules can erase apparent making-charge savings when you bring jewelry across borders. If you buy in Dubai and then bring the piece to India, customs duties and taxes may apply above duty-free allowances.
• Hallmarking and purity: Hallmarking standards and certification affect confidence. A hallmark for 22ct in India guarantees 916 purity. Dubai pieces may be 22ct or 24ct — confirm and compare on the invoice.
• Buyback and resale value: Many buyers forget that making charges are usually not refunded on resale. Sellers pay scrap value for the gold content. That makes low making charges better for short-term ownership.
• Design complexity vs gold weight: Charged per gram or per piece? Some jewelers charge a flat making per piece even for small items. That changes the math for lightweight, highly ornate designs.

Practical buying checklist

• Ask for a written invoice with weight (gross weight, stone weight, net gold weight), purity (ct), making charges, and taxes separately.
• Compare making charges as a percentage of metal value and as INR/AED per gram. Percentages reveal the relative burden as gold price moves.
• For plain chains and bullion, favor Dubai if you have a reliable seller and can avoid import duties. The making charge gap is usually greatest here.
• For traditional Indian pieces (Jadau, Kundan, temple work), buy in Mumbai if you want authentic craftsmanship. Dubai may not offer comparable price-quality for specialist work.
• If buying abroad, factor in customs allowances, possible taxes at home, and the expected buyback rate at home before deciding.

Bottom line

There is no absolute winner. For plain, weight-centric pieces and bullion, Dubai typically wins on making charges because of volume, competition, and lower premia. For specialist Indian designs and when local buyback or after-sales service matters, Mumbai can be better despite higher making charges. Always compare the full invoice — metal value, making charge, taxes, and buyback — and treat any savings from lower making charges as one part of the total cost picture.