India’s silver imports have witnessed a remarkable surge, reaching a record high in February with a staggering increase of 260%, according to government and industry officials cited by Reuters. Lower duties have encouraged substantial purchases from the United Arab Emirates (UAE), with imports expected to rise by 66% throughout the year.
The surge in demand from India, the world’s largest silver consumer, is poised to provide support to global prices, which are currently trading near their highest levels in three years.
In February alone, India imported a record-breaking 2,295 metric tons of silver, a significant leap from the 637 tons recorded in January, as reported by an unnamed government official. Notably, 939 tons of silver were imported from the UAE in February, with traders capitalizing on the lower duty regime.
Provisional data from the Ministry of Commerce and Industry reveals that India’s silver imports totaled 2,932 tons in the first two months of 2024, surpassing the figure of 3,625 tons for the entire year of 2023.
However, the substantial imports in early 2024 resulted in an oversupply situation, causing Indian prices to decline and prompting banks to curtail imports in March, according to a Mumbai-based dealer with a private bullion importing bank.
Chirag Thakkar, CEO of Amrapali Group Gujarat, a prominent silver importer, noted that the industry replenished stocks in January and February after depleting them in 2023. He highlighted the cyclical nature of Indian imports, suggesting that after a year of reduced imports in 2023 following record purchases in 2022, imports are expected to pick up in 2024.
Thakkar projected that India’s silver imports could reach 6,000 tons in 2024, compared to 3,625 tons in the previous year, driven by robust demand from the fabrication and solar industries. Additionally, there is increased interest from investors who view silver as offering higher returns compared to gold.
