Finance Minister Nirmala Sitharaman is set to present the Union Budget for 2026-27 in Parliament on February 1. Notably, this marks the first time in at
least a decade that the Union Budget is being presented on a Sunday. Here’s everything you need to know about the India Budget 2026.
With the Budget approaching, let's revisit that India’s gold and silver imports hit record highs last year, raising concerns for policymakers, as the government struggles to curb inflows despite soaring prices. Gold imports rose 1.6 per cent to $58.9 billion in 2025, while silver surged 44 per cent to $9.2 billion. There arises a question that will India be raising import duties on the safe haven?
Notably, India is the world’s second-largest gold consumer and the largest silver market, yet it imports nearly all its gold and over 80 per cent of its silver. Last year, the country spent almost a tenth of its foreign exchange reserves on these metals, with import costs expected to climb further in 2026 as prices rise, Reuters reported. Surging imports have widened the trade deficit and put additional pressure on the rupee, which touched a record low this month, according to Reuters.
Silver has industrial applications but gold is largely used for jewellery and investment. The government views such demand as non-essential and has repeatedly raised import duties to curb it.
Why are traders anticipating rise in import duties?
Gold and silver prices are hitting record highs and with this in place import values could surge even if volumes remain steady, raising concerns over a widening trade deficit and further rupee weakness, as per Reuters.
Trade and industry officials suggest the government may raise import duties on these metals in the coming weeks. In 2012 and 2013, duty hikes on gold helped stabilise the rapidly depreciating rupee. Traders now speculate a similar move may reverse the 2024 duty cuts, when import taxes were reduced from 15 per cent to 6 per cent to curb smuggling, said Reuters report. Gold and silver are already trading at a premium to global benchmarks, reflecting expectations of higher duties.
Silver sees brutal sell-off
Silver prices saw a steep fall on Friday, snapping the recent rally that had taken the white metal to record high levels. In overseas markets, spot silver recorded a historic intraday fall as the selling was brutal. Silver prices nosedived 36 per cent in intraday trade, reported Bloomberg.
At the close, spot silver fell $35.597 or 31.11 per cent to settle at $78.832 per ounce. Friday's freefall came just a day after silver touched an all-time high of $121.755 per ounce on Thursday.
The crash in silver was severe in the domestic market too. On the Multi Commodity Exchange (MCX), silver prices per kg tumbled as much as Rs 98,064 during intraday trade. The March 5 contract hit a day’s high of Rs 3,89,986 and a low of Rs 2,91,922 before finally settling near the day’s low at Rs 2,91,925.
