Explained: Why Silver Is Emerging as a Strategic Risk for India

India’s growing appetite for silver is quietly turning into a strategic vulnerability.

Silver imports surged to an estimated $9.2 billion in 2025, a sharp 44% jump year-on-year, even as global prices climbed steeply. The surge, driven by industrial demand and investor interest, has left India increasingly exposed to supply shocks and geopolitical risks, according to a report by the Global Trade Research Initiative (GTRI).

Prices tell the story of how quickly silver has transformed. In rupee terms, silver prices nearly tripled in 2025, rising from about ₹80,000–85,000 per kg at the start of the year to over ₹2.43 lakh per kg by early January 2026. The rally reflects a potent mix of geopolitical tensions, financial hedging and—most importantly—surging industrial consumption.

Globally, silver is no longer just a precious metal. More than half of global silver demand is now industrial, powered by electronics, solar power, electric vehicles, defence systems and medical technologies. Solar energy alone accounts for roughly 15% of global silver consumption, a share that is steadily rising as renewable capacity expands worldwide.

Trade data underline this structural shift. Global trade in refined silver has expanded nearly eight-fold since 2000, reaching over $31 billion in 2024. Yet supply has failed to keep pace. Persistent annual deficits of 200–250 million ounces have emerged as mine output remains largely flat while demand accelerates.

India sits at the centre of this imbalance. In 2024, the country accounted for 21.4% of global refined silver imports, making it the world’s largest importer. Unlike China— which imports silver ores and concentrates, processes them domestically, and exports higher-value products—India largely imports finished silver bars and rods. In FY25, India exported less than $500 million worth of silver products while importing over $4.8 billion, highlighting its heavy import dependence.

Supply-side risks are also mounting. China, the world’s largest silver processor, has shifted to a licence-based export regime for silver from January 1, 2026, tightening global availability. Adding to concerns is a $3.6 billion gap between reported global exports and imports of silver ores in 2024—pointing to opaque trade flows and weak supply-chain transparency.

GTRI argues that India must stop viewing silver merely as a precious metal and instead treat it as a critical industrial and energy-transition resource. The report recommends expanding domestic refining and recycling capacity, securing overseas mining partnerships, and diversifying import sources to mitigate strategic risk.

As global competition for critical minerals intensifies, the warning is clear: unless silver processing and supply security are brought firmly into India’s strategic policy framework, the country’s long-term industrial growth and clean-energy ambitions could face serious constraints.