Indian Silver Import Duty Sparks Shortage, Premiums Surge

India's recent hike in import duties on precious metals has disrupted the silver market, leading to a pronounced shortfall in physical supply within the country. Dealers report that premiums over international benchmark prices have risen to levels not seen in six months, reflecting tightening availability.

The policy change, aimed at curbing imports and managing the trade balance, appears to have backfired in the short term, as domestic demand remains robust while supply channels narrow. Market participants warn that the shortage could persist until import volumes adjust to the new duty structure.

The move underscores how tariff policies in major consuming nations can rapidly alter physical metal flows, impacting global silver prices and regional premium dynamics.