NEW DELHI: Days after doubling customs duties, the government on Saturday moved to restrict the import of certain types of silver as part of its strategy to curb rising bullion shipments.In a notification, the General Directorate of Foreign Trade transferred silver bullion containing 99% or more of the metal, as well as “other” silver bullion, to the restricted category versus free earlier. This means that imports will only be allowed after a license is issued by the government agency, a step typically used to stop the import of certain goods based on local requirements.Silver imports have witnessed a significant increase in recent months with rising prices on the global market, whether as an investment tool or for its multiple use in the industrial sector.Unlike gold, where the value of imports increased even as volume declined over the past fiscal year, silver imports rose two and a half times to $12.1 billion, while volume jumped 42% to 7,335 tons. This trend continued in April as well, with the latest Commerce Department data showing that the value of imports rose 2.6 times to $411 million.The decision to impose restrictions comes about a week after Prime Minister Narendra Modi appealed to citizens to reduce non-essential imports and postpone gold purchases.
Earlier this week, the government raised import duties on gold and silver from 6% to 15%.A senior government official said that the move was initiated primarily to monitor specific import lines.However, trade research body GTRI said the trade agreement with the UAE allowed for a tariff advantage of eight percentage points, as concessional tariffs from the West Asian trading partner are currently set at 7%, in line with the Comprehensive Economic Partnership Agreement. She added: “The restrictions aim to prevent a potential increase in low-duty silver imports being routed through the UAE under the Comprehensive Economic and Trade Partnership Agreement.”