Gold Imports Drop 22 Percent and Silver 94 Percent in May 2026
In May 2026, India recorded a significant drop in the volume of gold and silver imports due to new government restrictions and higher import duties. While gold's import value rose due to global price trends, actual physical arrivals for both metals have decreased substantially.
Highlights
- •Gold imports fell by 21.89 percent in volume to 24 tonnes in May.
- •Silver imports saw a dramatic 94 percent decline in volume, totaling 31 tonnes.
- •Government raised import duties on precious metals to 15 percent to protect forex reserves.
- •Higher global gold prices led to an increase in total import value despite lower volumes.
In a significant shift for the Indian precious metals sector, gold imports and silver imports have experienced a notable decline in volume during May. Despite the value of gold imports seeing a year-on-year increase, the actual quantity of these metals entering the country has dropped sharply, reflecting both market demand adjustments and regulatory constraints.
Impact of Regulatory Measures on Precious Metals
Official data from the Ministry of Commerce indicates that while the total value of gold imports rose by 34 percent to $3.416 billion in May compared to $2.549 billion in the same month of the previous year, this growth is largely attributed to higher international pricing. In contrast, the volume of gold imported during this period fell to 24 tonnes, marking a 21.89 percent decrease from the 30.6 tonnes recorded in May of the previous year. When analyzed on a month-on-month basis, the volume of gold imports plummeted by 47.58 percent from the 45.6 tonnes brought in during April 2026.
The situation for silver is even more pronounced. The value of silver imports saw a sharp decline of 86.65 percent, dropping to $75 million from $566 million in May last year. In terms of volume, the country imported only 31 tonnes of silver in May, a drastic 94 percent reduction compared to the 534 tonnes imported during the same month last year. Compared to April 2026, when the nation imported 182 tonnes, the May figures reflect an 82.9 percent month-on-month decrease.
Market Dynamics and Future Outlook
According to Chirag Sheth, founder of Metals Focus, the primary reason for the increased value of gold despite lower volumes is the substantially higher global price environment observed in May compared to the previous year. Regarding silver, he noted that the market had seen heavy influxes over the past eighteen months. However, as prices cooled and stricter regulations were enforced, demand levels subsided significantly.
To address the pressure on foreign exchange reserves and curb the inflow of these commodities, the government raised import duties on precious metals to 15 percent, up from 6 percent, during the second week of May. This policy change, alongside lingering issues regarding IGST compliance for export-oriented units, has effectively constrained the arrival of these metals. Industry observers note that even under the Advance Authorisation Scheme, clearances remain limited, representing only about one-fifth of the total required quantities. As the trade continues to navigate these tighter restrictions, the domestic market for precious metals remains in a period of consolidation and reduced activity.
