Silver Imports Plunge After Duty Hike and Import Restrictions: GTRI

India's silver imports witnessed a sharp decline in May 2026 following the government's decision to raise import duties and impose licensing requirements, according to a report by the Global Trade Research Initiative .

Silver importshad surged to a record $12.05 billion in 2025-26 from$4.83 billion in the previous fiscal year, marking a growth of nearly 150% and making silver one of India's fastest-growing import categories.

In response to the sharp rise in imports, the government increased the import duty on silver from 6% to 15% on May 12. However, the higher tariff created an 8 percentage-point duty advantage for silver imports from the UAE under the India-UAE free trade agreement, raising concerns over possible import rerouting to take advantage of lower tariffs.

To address this issue, the Directorate General of Foreign Trade on May 16 moved silver imports to the "restricted" category, making import licences mandatory.

The combined impact of the duty hike and import restrictions appears to have been immediate. Silver imports fell from $411 million in April to just $76 million in May, a decline of 81.6% within a month.

According toGTRI, future silver imports are likely to depend on the issuance of licences by the DGFT. Imports from the UAE may continue under preferential tariff provisions, while imports from other countries would attract the full 15% duty.

The report noted that gold has not been subjected to similar restrictions because the tariff advantage available under the India-UAE trade agreement is limited to around 1% under a tariff-rate quota system, reducing the scope for large-scale arbitrage.

The sharp decline in May imports suggests that the government's combined use of higher tariffs and quantitative restrictions