Silver Supply Tightens in India as Global Demand Remains Robust

Jewellers in Mumbai’s Zaveri Bazar have stopped accepting new silver orders as a severe physical shortage grips the market, as per The Economic Times report. 

Despite a recent dip in daily prices, strong industrial and investment demand worldwide has created high premiums on physical silver. Analysts foresee a temporary price correction but expect long-term upward pressure.

Local Market Impact

On October 15, 2025, silver prices fell ₹2,000 per kg, reaching ₹1.74 lakh, yet local jewellers have paused fresh orders. Countries such as Australia, Turkey, and China have intensified this shortage, impacting availability in India.

Read More: Why Has the Indian Government Restricted Silver Jewellery Imports?

Global Supply and Demand Dynamics

As per news reports, the silver prices surpassed $51.30 per ounce in October 2025, marking a 14-year high with 70% year-to-date gains.

This uptrend is driven by fundamental factors: industrial demand now accounts for 59% of silver usage, while a structural supply deficit has persisted for seven consecutive years.

Global silver supply stands at 31,000 tonnes, while demand exceeds 35,700 tonnes, creating a deficit of nearly 3,655 tonnes (118 million ounces).

Industrial consumption, especially in solar, electronics, and electric vehicles, continues to drive growth, with solar PV alone using over 200 million ounces annually, projected to rise to 450 million ounces by 2030.

Rising Institutional Interest in India

In India, silver ETFs surged 69% year-to-date in 2025, with monthly inflows up 180% in August, showing increasing participation from both retail and institutional investors.

Read More: Silver ETFs in October 2025: 1-Month, 6-Month, and 1-Year Returns in Focus.

Conclusion

The shortage of physical silver in Zaveri Bazar reflects broader global supply constraints and robust industrial demand. While temporary price adjustments are possible, the structural deficit, rising industrial consumption, and growing investment interest continue to shape silver markets.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.