Budget 2026: Big Decision on Silver Import Duty? Will Prices Fall or Rise?
Silver prices in India trade at a premium as markets expect a possible import duty hike in the Union Budget amid a sharp rise in silver imports and strong demand.
Silver prices in India are witnessing heightened volatility as market participants anticipate a possible increase in import duty on silver in the upcoming Union Budget. India meets a large part of its silver demand through imports, and the sharp rise in inbound shipments has raised concerns about the widening import bill.
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Market buzz suggests that Nirmala Sitharaman could consider a duty hike to cool imports, a move that has already pushed silver to trade at a significant premium in the domestic market.
Silver Imports Surge Sharply
Recent data shows a steep jump in silver imports:
- December imports jumped 79.7% month-on-month to $0.76 billion
- April–December imports rose nearly 129% to $7.77 billion, compared with $3.39 billion in the same period last year
Typically, silver imports peak during the festive season. However, the continued rise even after the festive period has raised red flags among policymakers and traders.
Impact of Last Year’s Duty Cut
In the previous budget, the government reduced the import duty on silver from 12% to 6%. The move aimed to:
- Curb smuggling
- Boost legal domestic sales
- Stabilize market supply
Currently, silver prices in India are influenced by:
- 6% customs duty
- 3% GST
Together, these levies play a key role in determining the landed cost and retail prices of silver across the country.
Will Import Duty Be Increased Again?
With demand surging and imports swelling, discussions in the bullion market suggest the government may reconsider the duty structure. While there is no official confirmation yet, analysts say the possibility cannot be ruled out.
According to Bhavik Patel of Tradebulls Securities, bullion dealers have already started charging a premium due to fears of a duty hike. Experts warn that if import duty is raised, silver prices could climb further in the near term.
What Lies Ahead for Silver Prices
The silver market is expected to remain sensitive ahead of the Budget. Any signal of a duty hike could:
- Push prices higher
- Tighten domestic supply
- Increase volatility in the bullion market
As Budget Day approaches, investors and consumers alike are closely tracking policy cues that could shape the future of silver prices in India.
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