From : https://schiffgold.com/key-gold-news/indias-appetite-silver/

 

 

                                             

 

 

Indians love gold. Despite rising prices, a tax increase, and government attempts to tighten regulation of the jewelry industry, gold imports into the country nearly tripled year-on-year in August. India ranks as the second largest gold consuming country in the world, trailing only China. But gold isn’t the only precious metal Indians covet. They also buy a lot of silver.

 

According to a new report by the Silver Institute, India consumed 160.6 million ounces of silver in 2016, accounting for 16% of global silver demand.

 

More than half of the silver flowing into India is used in jewelry and silverware.

 

 

     "These are traditional markets, though the demand drivers and consumer profile vary considerably between both segments. Typically, silver jewelry is purchased by most income groups in India, whereas silverware is bought by the middle and affluent classes. Since the start of this decade, there has been a large expansion of demand in both markets, from around 39 Moz in 2010 to 88 Moz in 2016. Of note, the Indian silverware market is the largest in the world and its importance is growing, representing 70 percent of the total global demand.”

 

 

Investment demand for silver has also picked up in the last decade. The Silver Institute called the increase in demand between 2010 and 2015 “unprecedented.” Physical investment surged from 25.7 million ounces in 2010 to a record high of 110 million ounces in 2015. Demand fell off in 2016 due to higher prices and government attempts to clamp down on “unaccounted” money.

 

 

     "India’s cultural affinity for silver underscores the country’s importance as a leading source of demand in the global silver marketplace. The breadth of the Indian silver market resonates across much of the country, currently the world’s seventh largest economy.”

 

 

India imports most of its silver, but it does produce some of its own. Indian mines produced 14 million ounces of silver in 2016, making the country the 14th largest silver producer globally.

 

The Silver Institute says its report “underscores India’s prominence in the international silver market. The country’s importance is poised to evolve even further as its economy grows and incomes rise.” More generally, it underscores the value Indians place on precious metals. They recognize their historic wealth-preserving qualities. Gold and silver offer Indians financial stability, especially in rural areas where much of the economy operates underground.

 

Buying gold and silver is interwoven into Indian culture, but the practical reasons to acquire precious metals transcend culture and national borders.

 

 

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