In February, India experienced an unprecedented surge in silver imports, skyrocketing by 260% to achieve a record-breaking high. This remarkable increase was attributed to lower duties, enticing substantial purchases from the United Arab Emirates (UAE), according to both government and industry insiders. Projections indicate that this trend will continue, with imports expected to escalate by 66% throughout the year.
With India being the world’s largest consumer of silver, heightened demand from this market could potentially bolster global prices, which are currently hovering near their highest levels in three years.
During February alone, India imported a staggering 2,295 metric tons of silver, marking a significant leap from the 637 tons recorded in January. Notably, the UAE emerged as a prominent source, contributing 939 tons to the total imports for the month.
Preliminary data from the Ministry of Commerce and Industry underscores this robust trend, revealing that India’s silver imports for the initial two months of 2024 already surpassed the total imports for the entirety of 2023, totaling 2,932 tons.
According to a Mumbai-based dealer from a private bullion importing bank, the substantial silver imports witnessed in the first two months of 2024 exceeded demand, leading to a discount in Indian silver prices. Consequently, banks nearly halted imports in March to mitigate the imbalance in the market.
Chirag Thakkar, CEO of Amrapali Group Gujarat, a prominent silver importer, noted that the industry had swiftly replenished stocks in January and February after depleting them in 2023. He highlighted the cyclical nature of Indian silver imports, suggesting that after record-high purchases in 2022 followed by a decline in 2023, imports are expected to rebound in 2024.
Thakkar predicts that Indian silver imports could reach 6,000 tons in 2024, a substantial increase from the 3,625 tons recorded last year. This surge is anticipated to be driven by robust demand from both the fabrication and solar industries.
Moreover, Thakkar emphasized a growing interest in silver for investment purposes, fueled by the belief that it may yield higher returns compared to gold.