India Grapples with 10% Premium on Global Silver Prices

As of October 13, 2025, India is grappling with a severe silver shortage, with prices soaring 10% above global rates. This is due to a combination of surging investor demand and strong festive season purchases, particularly ahead of Diwali, the Hindu festival of lights.

The premium on silver has prompted physically backed exchange-traded funds (ETFs) to suspend new subscriptions in order to protect investors from inflated costs. At the same time, jewelers in India are struggling to meet the high demand for silver, which is traditionally used in silverware, jewelry, coins, and bars.

The global silver supply has been unable to keep up with the growing demand, especially from the renewable energy and high-tech sectors. This has led to a significant investment in physically backed ETFs, coins, and bars, further widening the structural deficit and pushing prices to new record highs.

The situation has been exacerbated by a surge in silver shipments to the United States after its inclusion in a draft critical minerals list in September. India, the world's largest consumer of silver, relies on imports to meet more than 80% of its demand, and the country's silver imports have fallen by 42% in the first eight months of 2025 compared to the previous year.