India Bans Silver Imports to Boost Rupee

India Imposes Restrictions on Silver Imports to Stabilize Rupee

• India has shifted silver imports from “free” to “restricted” status, requiring government licenses for importation.
• Effective May 13, customs duties on precious metals increased from 6% to 15%, with total tax burden exceeding 18% due to additional taxes.
• In fiscal year ending March 2026, India imported approximately $12 billion worth of silver.
• Silver import value surged by 150% in FY 2025-26, with volume rising by 42%, contributing to a wider current account deficit.
• The new restrictions exclude certain Export Oriented Units and Special Economic Zones from licensing requirements but prevent them from selling domestically.

The recent restrictions on silver imports in India aim to control the current account deficit caused by a significant increase in import values. The policy shift affects jewelers and bullion dealers who now face higher costs due to increased duties and licensing requirements.