Poor man’s gold may become India's next big story

India's love affair with gold is well-known, but as gold prices soar, silver is quietly gaining traction. Over the past two years, silver prices have surged by 160%, climbing from ₹89,537 per kg to a record ₹2.32 lakh per kg. Once seen as merely a "poor man's gold," silver is now being embraced for its affordability and versatility in jewellery, coins, bars, and even industrial applications like solar panels and electronics.

Experts say the shift towards silver is driven by its lower cost, making it more accessible to consumers who cannot afford gold. India's silver market is expected to see a 17-18% increase in buying during Diwali, the major Indian festival of lights. Silver demand comes from various sectors, and investment demand surpassed traditional consumption last year due to growing interest in silver ETFs.

While gold remains popular, the government is pushing for greater reuse and recycling of the metal as prices remain high. Silver could act as a "saving grace" for the jewellery sector, offering consumers more design options and helping them experiment with different styles. However, silver needs to be presented differently to gain wider acceptance, said Suvankar Sen, Managing Director and CEO of Senco Gold & Diamonds.

For silver to become a bigger part of the jewellery story, consumers must view it differently. Silver has traditionally been associated with utensils and articles, but innovation in design could help give it the respect it deserves. At Senco, silver demand has risen by about 25-30% in volume terms on average, with interest picking up despite last year's price volatility.

Traditionally, silver consumption in India was driven by coins, religious and spiritual products, gifting, and utility items. However, lifestyle and fashion are increasingly becoming part of the silver story. Younger Indians, in particular, are looking at silver as a fashionable and versatile purchase option. The bigger opportunity for the industry is to stop positioning silver as a "understudy" to gold and build the category around design and quality.

If the organised sector gets serious about design and presentation in the silver space, India's jewellery sector could see a new growth story in silver.