look news india
A big and shocking news is coming out from the Indian bullion and commodity market. There has been a historic decline of more than 80 percent in the import of silver in the country. Shipments coming from abroad have stopped at the ports due to the increase in import duty by the government and the Directorate General of Foreign Trade (DGFT) changing silver from ‘free’ category to ‘restricted’ category. This unexpected decision is having a direct impact on the country’s bullion market, jewelers and industrial sector. Let us understand this entire matter and its economic reasons from the perspective of a business reporter.
After all, why did the government have to take such strict steps?
In fact, during the last financial year (FY 2025-26), India’s silver import increased by 150% and crossed a record $ 12 billion (about Rs 1 lakh crore). This was putting huge pressure on the country’s trade deficit and foreign exchange reserves.
Also, silver was being brought to India on a large scale by using the tariff benefits available under the Free Trade Agreement (FTA) with UAE. To stop this arbitrary import and control the domestic market, the Central Government increased the import duty from 6% to 15% with immediate effect and banned the import of silver without a government license.
Shipment stuck, shortage and premium of silver increased in the market
Due to the mandatory licensing process, large consignments of silver coming from countries like UAE, Britain and China are stuck at the ports. The supply chain has been badly affected due to delay in getting permission from DGFT:
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Huge shortage in supply: Silver imports have dropped to just a few million dollars in the month of May, which is the lowest level in the last few years.
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Impact on local market: More than 80% of silver consumption in the country is dependent on imports. Due to supply stoppage, premium on silver has increased in the domestic market.
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Industry concerns: There is a delay in the availability of raw materials for solar panels, electronic switches and jewelery industries.
What will happen next? Know the trend of bullion market
Experts believe that unless DGFT speeds up the pace of issuing new licenses to banks and authorized traders, this slowdown in imports will continue. Only 100% Export Oriented Units (EOUs) and SEZ units are exempted from the license with limited conditions. If the supply does not normalize before the coming festive season, then silver prices in the Indian market may touch further record highs.