India’s silver imports increase amid high demand and investment boom
Data from the Trade Ministry revealed that India imported 4,554 tons of silver in the first half of 2024, an increase from just 560 tons during the same period last year.
India is on track to double its silver imports this year, with increased demand from the solar panel and electronics sectors and a rising interest from investors who see silver as a potentially more lucrative investment than gold. This surge in imports reflects the country’s growing reliance on silver for industrial use and investment purposes, according to industry leaders.
Data from the Trade Ministry revealed that India imported 4,554 tons of silver in the first half of 2024, an increase from just 560 tons during the same period last year. This dramatic increase highlights the rising demand for the metal in various sectors of the economy. “There is a traditional demand for jewelry. People are also buying for investment purposes now that the duty cut has made silver more affordable,” said a leading importer, Thakkar, during an interview with Reuters at the India Gold Conference.
In July 2024, the Indian government reduced import duties on silver from 15% to 6%, a move aimed at restrain smuggling and making the metal more accessible to domestic buyers. This policy change has got investment demand, as people are seeking to capitalize on the returns that silver could offer, especially when compared to gold.
Price Trends and Future Outlook for Silver Imports
Thakkar described the investment demand as “phenomenal” in the first half of 2024, attributing the increase to the anticipation that silver would outperform gold in terms of returns. This is seen in the performance of local silver futures, which reached a record high of 96,493 rupees ($1,151) per kilogram in May 2024. So far this year, silver prices have increased by nearly 14%, slightly outpacing the 13% rise in gold prices.
The demand for silver is not limited to just investors. Industrial buyers, particularly in the solar and electronics industries, have been stockpiling the metal this year. A bullion dealer at a silver-importing bank stated that depleted inventories in 2023 have caused these buyers to secure their supplies in expectation of further price increases.
India sources its silver imports primarily from the United Arab Emirates, Britain, and China, showing its global trade connections in acquiring the metal. As the year progresses, the ongoing demand for silver in both industrial and investment sectors is expected to continue driving imports, solidifying the metal’s importance in India’s economy.
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