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 shipments 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, according to the Ministry of Commerce and Industry.
Import Statistics Detail
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. The plunge follows a record $12 billion spent on silver imports in the 2025/26 financial year ended March, compared with $4.8 billion a year earlier.
| Metric | May 2026 | May 2025 | Year-on-Year Change |
|---|---|---|---|
| Import value ($) | $75.57 million | $566.22 million | -87% |
| Import volume (mt) | 33 | ~550 (implied) | -94% |
Government Measures and Rationale
In mid-May, India 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 from the Directorate General of Foreign Trade. The government 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, according to the data.
Demand Response and Premiums
Despite the import collapse, domestic demand remains intact. "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. 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 exchange-traded funds (ETFs) climbing to a record high, the dealer added.
Trade Partners and Outlook
India imports silver mainly from the United Arab Emirates, Britain and China. The sharp reduction in imports is expected to continue as the restrictions remain in place. Lower Indian purchases could put downward pressure on global silver prices, while improving India's trade balance and relieving some pressure on the rupee. Traders and analysts will watch for further policy updates from the Ministry of Commerce and Industry, as well as global silver price movements on exchanges such as the Comex and LBMA.
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