India’s silver imports plunged
87% in May from a year earlier to their lowest level in more
than three years, government data showed on Monday, after the
world’s largest consumer of the metal tightened curbs on imports
in nearly all forms.
Lower imports by India, which meets more than 80% of its
silver demand through overseas purchases, could weigh on global
prices, while helping narrow the country’s trade deficit
and ease pressure on the rupee.
Silver imports fell to $75.57 million in May from $566.22
million a year earlier, according to data compiled by the
Ministry of Commerce and Industry. In volume terms, imports
dropped 94% year-on-year to 33 metric tons, the lowest since
February 2023.
India in mid-May restricted imports of silver in nearly all
forms with immediate effect. Earlier this month, it further
tightened the rules by adding silver grain and powder to the
restricted category and requiring prior import authorisation.
The government has also raised import duties on gold and
silver to 15% from 6% as part of efforts to curb precious metals
imports and reduce pressure on foreign exchange reserves amid
elevated oil prices.
“There is demand, but imports have become difficult due to
the restrictions, and local premiums have started to rise,” said
a Mumbai-based dealer with a private bullion-importing bank.
India spent a record $12 billion on silver imports in the
2025/26 financial year ended March, compared with $4.8 billion a
year earlier.
Silver is used in India for jewellery, coins, bars and
industrial applications ranging from solar energy to
electronics.
Over the past year, demand has been driven more by
investment buying than traditional jewellery and silverware
consumption, with inflows into silver ETFs climbing to a record
high.
India imports silver mainly from the United Arab Emirates,
Britain and China.