Indian Silver Trade

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The age-old prevalence of silver in India led to a variety of usages. Well off Indians have used silver for a wide range of purposes for ages. Such extensive usage of the precious metal naturally resulted in Indian Silver Trade.

Historical significance of silver in India

Traditionally, Indians used silver in two primary ways:
  • To mint coins during the regime of monarchy.
  • To make jewelry and other ornaments

Although silver is no longer used to make coins today, the importance of silver has not waned with the passage of time. With an annual intake of 3,500 tonnes, India is seen as a major consumer of silver. India has, however, been a price-taker in the international market primarily because of the absence of a gold-silver futures trading exchange in the country.

After a gap of 42 years, India has recently launched futures trading in gold and silver to help maintain price stability in these precious metals. The futures will be traded online. The National Multi-Commodity Exchange of India in Ahmedabad was the first to be recognized by the Forward Market Commission for futures trading in precious metals. This exchange had started futures trading in 24 commodities in November 2002 and had subsequently added 23 more commodities.

Silver Trade in India is expected to curb wild fluctuations in prices as a response to domestic or international trends and cushion the bullion market. Indian bullion traders hedge in gold in international markets to the extent of about INR 10 billion per day. India has a bright future ahead as far as Silver Trade is concerned.