Nepal Rastra Bank (NRB) has revised its foreign exchange regulations related to silver imports and exports, easing restrictions for importers while strengthening compliance requirements for exporters. The policy change comes at a time when silver prices have surged sharply in recent weeks, crossing $75 per ounce on Friday for the first time. According to AFP, precious and industrial metals have reached record highs toward the end of the year, driven by global economic and geopolitical uncertainties.
Under the amended Unified Circular issued on Sunday, NRB has increased the monthly foreign exchange ceiling for industries importing silver for industrial purposes to US $2 million. Previously, such industries were allowed foreign exchange facilities of only up to US $500,000 or its equivalent in other convertible currencies.
The revised provision applies to industries that use silver as a raw material for manufacturing jewelry, artistic products, and utensils for their own production needs.
In addition, NRB has raised the foreign exchange limit for silver traders to US $400,000, up from the earlier ceiling of US $100,000 or its equivalent in other convertible foreign currencies.
Kiran Pandit, Executive Director of NRB’s Foreign Exchange Management Department, said the flexible policy was introduced primarily to lower costs for importers. He explained that repeated imports expose industries and traders to higher expenses due to price fluctuations and multiple foreign exchange transactions.
Data from the Federation of Nepal Gold and Silver Dealers’ Association (FENEGOSIDA) show that silver prices in the domestic market hit a record Rs 4,835 per tola on Sunday, representing a 60 percent increase over the past six weeks. On November 9, silver was trading at Rs 3,015 per tola.
While import rules have been relaxed, NRB has tightened foreign exchange regulations for exporters of silver jewelry, artistic items, and related products. Exporters are now required to submit proof of advance payment or a letter of credit confirming export or purchase orders from foreign buyers.
According to the NRB circular, commercial banks must verify each time foreign exchange facilities are provided that silver imported under pre-exchange arrangements has been exported in line with regulations. Banks are also required to obtain a self-declaration from silver traders confirming that there are no outstanding dues when receiving export proceeds, especially if the import-related foreign exchange facility was obtained from another commercial bank.
