High gold prices offer jewellers a silver lining this festive season

Silver, historically the second fiddle to gold in traditional jewellery, seems set for a golden run in India.

With the price of the yellow metal stubbornly elevated, putting it out of reach for many middleclass Indian buyers, silver is quietly moving into the spotlight.

From ornaments and idols to furniture, jewellers and traders are offering a range of silver products to woo buyers and investors, as the once-overlooked metal emerges as a potential star of the festival season beginning with Navratri on October 11.


Several jewellers and an industry expert told ET that silver is likely to account for a larger share of jewellery purchases this festival season.

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Shift in Consumer Behaviour

“I am a third-generation diamond jeweller based in Surat. But today, I earn more from silver than from diamonds,” said Nagnesh Pachchigar of SN Jewellers. Silver now accounts for as much as 35% of his annual revenue. In India, 10 grams of 24-karat gold costs about Rs 1.5 lakh. For the same amount, buyers can get about 650 g of silver.

This festival season, Pachchigar’s bets are firmly on silver, driven by a simple shift in consumer behaviour. Middle-class Indians, he said, are increasingly turning to silver products as affordable gifts. “Silver is clearly the next gold. I expect 40% of our annual silver sales only during the monthlong festive season starting with Navratri,” Pachchigar said.

Surendra Mehta, national secretary of the India Bullion and Jewellers Association, said, “We estimate that silver buying during this Diwali season will rise by 17- 18% from the corresponding period last year.” The supply side, he said, is no longer a constraint, with the government in July easing silver import curbs introduced in May, partly to contain the outflow of foreign exchange. The response was swift — silver imports jumped to over $1 billion in August, marking a 127% year-on-year increase, according to data from the commerce ministry.