NEW DELHI: Finance Minister Nirmala Sitharaman on Monday said India’s rising gold and silver imports are not yet a cause for alarm, attributing the sharp increase in global prices largely to aggressive buying by central banks worldwide rather than solely to domestic demand.
Responding to questions at the post-Central Board meeting press conference of the Reserve Bank of India (RBI), the Minister noted that India imports nearly all the gold it consumes and that precious metals have traditionally been a preferred investment avenue for Indian households.
“Every ounce of gold that comes into the country is imported. We do not have sufficient domestic extraction,” she said, adding that household demand typically rises during festival seasons and weddings. Gold continues to be viewed as a favored asset class, and seasonal spikes in consumption are common.
However, she emphasized that the recent unbelievable spike in global gold and silver prices is being driven by central banks accumulating gold reserves. “Most countries today, particularly their central banks, are buying gold and storing them. The spike is largely due to purchases by central banks,” she observed, indicating that international price movements are now being shaped more by sovereign reserve strategies than by retail consumption in countries like India and China.
Gold and silver imports surged in January 2026 with imports of yellow metal in value jumped 350%, and silver by 127% during the month. In the April 2025-January 2026 period, gold imports rose by 20% to $61.5 billion, while silver imports during the month increased by 127% to $7.8 billion.
The RBI Governor Sanjay Malhotra said that whatever was the increase in prices was more or less offset by a decrease in volumes of imported gold.
The Governor acknowledged that January saw a sharper rise in both value and volume of imports, but said the central bank is still analysing the numbers. He stressed that the situation does not pose immediate macroeconomic concerns.
India’s external sector, he said, remains “very strong and robust.” The current account deficit is projected to remain manageable at around 1% of GDP. He also highlighted strong foreign exchange reserves, steady gross foreign direct investment inflows, and recent policy measures—including trade agreements and sectoral liberalisation—that support capital flows.