Why was there a shortage of silver in the country before Diwali amid skyrocketing prices?

Silver Shortage: In view of the festive season and Diwali in India, the demand for silver has increased a lot. At the same time, there is a shortage of silver in the country. Due to high demand in the country, silver is being sold at 10 percent higher prices than global prices. According to media reports, the Silver Investment Fund (ETF) has stopped purchasing silver. Due to which there is shortage of silver in the country. The demand of the festival has increased it even more.

Why is there problem in importing silver?

There is a shortage of silver in the world’s largest silver producing countries. On the other hand, the demand for silver is increasing due to investment and new technology all over the world. High demand and low supply have placed silver in the category of premium metal. Also, investors invested Rs 53.42 billion in silver ETFs in the month of September.

Investors are betting on silver as a safe option. In the last few months, silver has given good returns to investors. Due to all these reasons, there is a problem in importing silver.

Why is there a shortage of silver?

70 percent of silver production is extracted from mines of other metals. Talking about the last 4 years, the demand for silver across the world has been more than the supply. Besides, the remaining silver in the last 5 years has also been exhausted. Silver is used in making new technology, high tech vehicles and many other modern items. Therefore the demand for silver remains. The supply of silver is not sufficient in the year 2025.

Also, silver utensils, jewellery, coins, bars etc. are purchased in Indian homes. Its demand increases further during Diwali and festivals. India imports 80 percent of its needs from other countries. Talking about the figures, a decline of 42 percent has been recorded in the import of silver in the first 8 months of the year 2025. There has been a surge in demand for silver even at the global level. America had imported silver in large quantities in the month of September.

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