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Informist, Wednesday, Jan. 29, 2025

 

By Sandeep Sinha

 

MUMBAI – Silver imports into India nearly doubled in calendar 2024 to 7,000 tonnes, from 3,625 tonnes in 2023, according to trade and industry sources. The rising price of gold forced consumers to shift towards silver jewellery, they said. Also, the increased use of silver in the electronic and electrical sectors, and in the growing production of solar photovoltaic cells in the country, led to higher imports, they added.

 

According to market sources, India imported 410-440 tonnes of silver in December. Data from the commerce ministry showed the country had imported 185.84 tonnes of silver in December 2023.

 

The government has an ambitious plan to increase the share of renewable energy in the country's total energy mix, which has led to continued investment and capacity addition in solar photovoltaic module production. The government has set a target of 500 gigawatts of renewable energy production by 2030, most of which will come from solar power, which uses a lot of silver. The country's total renewable energy-based electricity generation capacity now stands at 203.18 GW, of which 92.12 GW comes from solar power, according to the Central Electricity Authority.

 

"The surge in silver imports is driven by increased demand from the renewable energy, electric vehicle, and 5G (fifth generation mobile telephony) sectors, where silver plays a critical role. Additionally, silver remains more affordable than gold, attracting more investment," Prithviraj Kothari, managing director of RiddiSiddhi Bullions, said.

 

Kothari expects silver imports to remain high on sustained demand from industrial sectors such as solar power and electric vehicles. As inventories stabilise, imports are expected to return to more moderate levels. The total value of silver imported by the country rose over 121% on year to $5.78 billion in 2024, compared with $2.61 billion in 2023, the commerce ministry data showed.

 

According to the ministry's data, the country imported 2,651.38 tonnes of silver bars, followed by 589.70 tonnes of silver grains, 111.29 tonnes of all other semi-manufactured forms of silver, 50.57 tonnes of silver in powder form, 4.19 tonnes of silver sheets, plates, strips, tubes, and pipes, and 32.41 tonnes of other forms of silver in Jan-Nov.

 

The UK was the largest silver exporter to India in Jan-Nov, followed by the United Arab Emirates, Hong Kong, Switzerland, and Uzbekistan. During these 11 months, India imported 2,721.95 tonnes of silver from the UK, 2,220.06 tonnes from the UAE, 815.44 tonnes from Hong Kong, 206.76 tonnes from Switzerland, and 99.57 tonnes from Uzbekistan, according to the ministry's data.

 

India's gold imports in December are estimated at 52-58 tonnes, compared with 54.7 tonnes a year ago. In 2024, total gold imports by the country are likely to have been at 720-724 tonnes, down from 743.86 tonnes in 2023.

 

"The decrease in December gold imports is primarily due to high global gold prices and a weakening rupee, which made gold more expensive," Kothari said. "Additionally, the festival and wedding seasons, which drove higher demand in November, had passed, leading to lower buying. Jewellers also reduced imports after stocking heavily in November."

 

India has imported an average of 830 tonnes of gold per annum in the past two decades, and 820 tonnes in the last 10 years. "Reduced bullion imports in 2024 reflect high gold prices and a shift towards alternative investment forms like digital gold and ETFs," Kothari said. "Additionally, increased import duties and economic uncertainties have impacted demand, with consumers becoming more cautious in their purchases."

 

Sachin Jain, regional chief executive officer India, World Gold Council, had told Informist in an interview that the country was likely to maintain gold imports at around the 720 tonne mark in 2024, with investors gradually shifting to investment in multiple gold-based financial products. Maintaining gold imports at the same level is already an achievement and reflects heightened interest in the yellow metal, he had said.

 

According to commerce ministry data, Switzerland was the largest exporter of gold to India in Jan-Nov, followed by the UAE, Peru, South Africa, and the Dominican Republic. During this period, India imported 219.78 tonnes of gold from Switzerland, 150.99 tonnes from the UAE, 63.16 tonnes from Peru, 55.60 tonnes from South Africa, and 26.88 tonnes from the Dominican Republic, the data showed.  End

 

US$1 = INR 86.54

Edited by Rajeev Pai

 

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