India's May Silver Imports Plunge 87% to Over Three-Year Low
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India's silver imports crashed 87% year-on-year to $75.57 million in May, with volumes dropping to 33 tonnes — the world's largest silver consumer is now transmitting a demand gap into global markets.
How steep is the drop?
May silver imports totalled just $75.57 million, down from $566.2 million a year earlier — a collapse in both volume and value.
Import volume fell to 33 tonnes, the lowest since February 2023.
This means → In a single month, the buyer that accounts for the bulk of global silver demand all but vanished from the market.
What triggered the cliff-edge fall?
The direct cause: India's government imposed restrictions on nearly all forms of silver imports from mid-May, then expanded the curbs this month to cover silver granules and powder.
All silver imports now require prior authorization — effectively a gate on every shipment.
At the same time, import duties on gold and silver were raised from 6% to 15%. In plain terms = the government is squeezing both volume and price to shut the import door.
Why is the government acting now?
India's silver imports had already hit historic highs: full-year imports in FY 2025/26 reached a record $12 billion, up sharply from $4.8 billion the prior year.
The demand driver has shifted — from traditional jewellery consumption to investment-driven buying, with silver ETF inflows hitting all-time highs in parallel.
This reflects a deeper concern: not just the trade deficit, but speculative demand draining foreign-exchange reserves and pressuring the rupee.
How is the domestic market responding?
Tighter supply has already pushed up local premiums. A Mumbai-based precious-metals trader told Reuters: "Demand is still there, but restrictions are making operations difficult — local premiums have started rising."
This means → Imports are down, but domestic demand has not disappeared — it is simply re-emerging as higher prices.
What does this mean for global silver prices?
India is the world's largest silver consumer; over 80% of its silver is imported, mainly from the UAE, UK, and China.
In the short term, India's import collapse could weigh on global silver prices — the biggest buyer has stepped out.
The key variable ahead: whether controls can keep imports suppressed, or whether demand reroutes through alternative channels — that determines whether the price drag is temporary or lasting.
Content is for reference only, not financial advice.