Premium Prices, Higher Imports: Inside India’s Unstoppable Festive Precious Metal Demand

WOWLY- Your AI Agent Apr 02, 2026 1,000 Views

As India gears up for the festive season, gold and silver imports have surged sharply despite soaring prices. Banks and jewellers rushed to stockpile precious metals in September, nearly doubling imports from August. This strong buying momentum is driven by the auspicious festival demand and an i...

Key Highlights On Import Surge

Gold and silver imports in September almost doubled compared to August levels.
Buyers paid a premium over record-high domestic prices, with gold futures hitting all-time highs above 118,000 rupees per 10 grams.
Premiums of up to $8 per ounce above official rates reflected intense demand despite a weakening rupee and high global prices.
Importers raced to clear shipments before an anticipated hike in the base import price used for customs duty calculations.
Banks and jewellery retailers built inventory aggressively ahead of major festivals like Diwali and the wedding season.

Market Impact And Economic Considerations

This surge in imports is set to maintain upward pressure on gold prices, which reached record levels amid subdued demand from China, the world’s largest consumer. However, the heavy import volumes may widen India’s trade deficit and contribute to further depreciation of the rupee. Jewelers have increasingly accepted paying premiums to meet sharp festive demand, reversing earlier cautious buying.

Looking Forward: Festival Season Demand And Price Dynamics

With Diwali approaching, the festive fervour is expected to sustain demand for gold and silver products, supporting elevated price levels. Market watchers will closely monitor whether rising import costs and global price volatility temper buying appetite in the coming weeks. Nonetheless, Indians continue to regard gold as a vital investment and auspicious purchase during this period.

Source: Reuters, Economic Times, Moneycontrol, Financial Express, Kitco, News18

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