Indians have long worn their love for gold on their sleeves. But with gold prices reaching levels that can make even a small piece a serious purchase, silver is quietly stealing some of the attention.
In just two years, silver has turned from a humble metal to a runaway asset: from ₹89,537 per kg in September 2024, prices climbed to ₹1,41,918 a year later, before smashing past ₹2.32 lakh per kg this September — a hefty 160% surge in 24 months.
Long dismissed as merely “the poor man’s gold,” silver is suddenly finding new ground in gifting, everyday wear, and fashion-forward jewellery.
The question now is whether silver is finally having its star moment.
“100%,” said Surendra Mehta, National Secretary, India Bullion & Jewellers Association (IBJA), when asked if silver’s record run is changing consumer interest. India’s shift towards silver is likely to change jewellery-buying habits in the long term, he told ET Online.
“One of the main drivers is affordability as people are realising that if gold is out of reach, silver offers a way to still participate in the precious metals rally.”
IBJA estimates that silver buying during this Diwali season will rise by 17-18% from the corresponding period last year.
Silver demand in India comes from jewellery, coins, bars and industrial applications such as solar panels and electronics. In the past year, investment demand has surpassed traditional consumption, driven by growing interest in silver ETFs, according to a Reuters report.
Silver, a ‘saving grace’
While Indians’ love for gold runs deep, record prices are forcing consumers to think harder about what they buy. Gold has already made its mark, but the government is now pushing for greater reuse and recycling of the metal at a time when prices remain elevated, Suvankar Sen, Managing Director and CEO of Senco Gold & Diamonds, told ET Online.
“People will continue to buy gold, but there will obviously be restrictions and budget constraints,” Sen said. Silver, he added, could be a “saving grace” for the jewellery sector, giving consumers more room to experiment with designs.
But for silver to become a bigger part of the jewellery story, consumers will need to see it differently, he said. “Silver has traditionally been associated with utensils and articles. I think we also need to innovate with designs and give silver that respect. It could become the next big story for sure.”
At Senco, silver demand has risen about 25-30% in volume terms on average. Sen said interest in the metal is picking up, although the pace was faster during last year’s festive season than it is currently.
“The reason is that last year, silver prices jumped sharply — from around Rs 70-80 a gram to Rs 100, then Rs 120, Rs 150, Rs 180, Rs 220 and Rs 250, and eventually went up to around Rs 400. After reaching Rs 400 a gram, prices crashed to around Rs 200 in February-March. Now they are at around Rs 220-230.”
So, until prices start showing a clear direction, people are just waiting and watching, he said.
“When they realise that this is a good price to buy, that prices are unlikely to fall and that they may move up again, they will start buying more.”
Meanwhile, at Kalyan Jewellers, consumers have shown “increased” interest in silver jewellery, as per the company’s Executive Director Ramesh Kalyanaraman. But how much of that interest is translating into actual sales remains unclear
Traditionally, silver consumption in India was driven by coins, religious and spiritual products, gifting and utility items. “Today, lifestyle and fashion are increasingly becoming part of the silver story. Consumers view silver jewellery as an easy, versatile and fashionable purchase. This trend is expanding the overall silver category,” Kalyanaraman said in an email response to ET Online.
No longer just ‘the cheaper metal’
Gold may have pushed silver into the spotlight, but the shift is not just about price. Younger Indians, in particular, are looking at silver differently as they seek jewellery they can experiment with and wear more often, something that is harder to do with gold at current prices.
Silver is no longer just “the cheaper metal”, said Joy Alukkas, Chairman & Managing Director, Joyalukkas Group. Younger consumers are looking for jewellery they can wear regularly, and silver fits that need “naturally.”
The bigger opportunity for the industry, he said, is to stop positioning silver as gold’s “understudy” and build the category around design and quality. “That’s how you turn a trend into a category.”
Silver, he said, “absolutely” has the potential to become one of the standout growth stories in the Indian jewellery sector, but as a complement to gold, not a competitor.
“If the organised sector gets serious about design and presentation in this space, we have a real chance to convert today’s curiosity into tomorrow’s habit. That, to me, is what would mark the start of silver’s own chapter in India’s jewellery story.”
Price-sensitive market
The question now is whether that momentum can be sustained at high price levels. Debajit Saha, Lead Metals Analyst at the London Stock Exchange Group (LSEG), told ET Online that silver jewellery demand remains price-sensitive.
He expects some improvement in the coming months as the festive season supports consumer purchases. Even with a seasonal rebound, however, he expects silver jewellery demand in 2026 to remain below last year’s level, while investment demand should remain “resilient.”
The price sensitivity of the market is also reflected in the industry data. The silver jewellery market had a good run in 2024, with global fabrication rising 3% to 208.7 million ounces, led largely by India. Lower import duties, a healthy rural economy and a shift towards higher-purity jewellery helped drive the increase, according to the Silver Institute, a US-based nonprofit international industry association for silver.
But the momentum was short-lived, as the sharp rise in silver prices began to squeeze affordability.
Silver prices are currently consolidating after the sharp rise and subsequent correction earlier this year. The surge towards $121/oz was driven largely by speculative activity rather than fundamentals, Saha said.
“As the gold-silver ratio approached 100, investors increasingly viewed silver as significantly undervalued relative to gold, attracting momentum-driven buying.”
However, silver’s underlying fundamentals did not justify prices at those elevated levels. Once market sentiment shifted, the speculative premium unwound quickly, resulting in a much sharper correction in silver than in gold, he stated.
The gold-silver ratio shows how many ounces of silver it takes to buy one ounce of gold. Historically, traders often watch this ratio as a relative-value indicator. When it gets unusually high, some investors may interpret it as silver being cheap compared with gold and buy silver.
The white metal’s price sensitivity is reflected in the fabrication data. In 2025, Indian silver jewellery fabrication fell about 20% as rupee silver prices climbed to record highs, the Silver Institute said.
Globally, silver industrial demand reached a record 680.5 Moz in 2024, while the US-based organisation expects the global silver market to remain in deficit for a sixth consecutive year in 2026.
For India, the interesting part is the combination of affordability-led jewellery adoption and rising “investment interest,” according to Paresh N. Bhagat, MD & Chairperson of Mangal Keshav Financial Services.
India’s silver market witnessed a dramatic surge in 2025 amid a tightening global supply and rising industrial demand. According to a Kotak Mutual Fund report, India became the world’s largest importer of refined silver, with imports estimated at about $9.2 billion for the year, marking roughly a 44% increase over 2024 despite higher prices.
Bhagat, however, cautions against assuming that every rupee moving from gold into silver represents a permanent shift in consumer demand.
That caution is echoed by the wider gap between the two metals, with silver still far from matching gold’s value. Silver still has a “long way” to go before it rivals gold in value, according to Mangesh Chauhan, MD, Sky Gold & Diamonds. Gold has a longer history of steady appreciation, he said, while silver tends to be more speculative and its prices can swing more sharply.
IBJA’s Mehta, meanwhile, believes that the gradual movement from gold to silver “is bound to happen.”
What’s in it for investors?
For investors, silver’s story comes with both opportunities and risks. The biggest near-term triggers are likely to be the US midterm elections and how G7 economies manage inflation and interest rates, Saha warned.
Early warning signals are already emerging in bond markets. Long-term yields in the US and Japan have risen, followed by higher interest rates from their central banks. Investors will need to track these moves closely, Saha stated, as they could become a “make-or-break” factor for precious metals.
“Investment demand for silver, however, is expected to remain relatively resilient. Asset managers are increasingly turning to precious metals, particularly gold and, to a lesser extent, silver, as portfolio stabilisers during periods of economic uncertainty and inflation. In India, concerns over energy-driven inflation could further support demand for silver as an investment, although gold is likely to remain the preferred defensive asset.”
Bhagat, meanwhile, sees room for silver to develop into a larger consumption and investment story, but cautioned against viewing it simply as the “next gold”. For investors, he said, physical volumes will be more telling than sales value, since higher silver prices can lift revenues without necessarily pointing to stronger underlying consumption.
