With gold prices reaching new heights, Indian consumers are increasingly turning to silver for festive gifting and ornaments, signalling a significant shift in jewellery purchasing patterns ahead of Diwali.
India’s festive jewellery market is entering the season with a clear shift in mood: as gold has become increasingly expensive, silver is moving from a secondary role to the centre of consumer attention. With gold prices having climbed to levels that put many purchases out of reach for middle-class buyers, jewellers are reporting stronger interest in silver pieces ranging from ornaments and idols to decorative items and giftware. For many retailers, the metal once treated as a cheaper alternative is now emerging as a serious sales driver ahead of the festival stretch beginning on 11 October.
That change in buying behaviour comes against a backdrop of very high gold prices, which have altered the mix of jewellery demand across India. The World Gold Council said in its India-focused quarterly reports for 2026 that jewellery demand in value terms remained resilient even as volumes weakened, helped by wedding purchases and a shift towards lighter, lower-carat and studded designs. The council also noted that many retailers have seen a large share of sales come from old gold exchanges, a sign that households are adapting to higher prices rather than abandoning the market altogether.
Silver sellers say the momentum is now moving their way. Nagne sh Pachigar of SN Jewellers in Surat told local media that his business now earns more from silver than diamonds, and that about 35% of his annual income comes from the metal. He expects silver to account for a much larger share of sales during the month-long festive period, arguing that middle-class consumers are increasingly choosing silver as a practical gifting option. His view reflects a broader retail trend: when gold is too costly, shoppers are looking for something that still feels precious without the same financial burden.
The India Bullion and Jewellers Association expects silver buying during the Diwali season to rise by 17% to 18% from a year earlier. Surendra Mehta, the association’s national secretary, said supply should not be a constraint after the government eased restrictions on silver imports in July, following curbs introduced in May to help manage foreign currency outflows. Commerce Ministry data showed that those changes quickly fed through to trade flows, with silver imports jumping to more than $1 billion in August, up 127% from a year earlier.
The broader jewellery industry remains large and strategically important for India’s economy. According to the India Brand Equity Foundation, the domestic gems and jewellery market stood at about ₹7.31 lakh crore in January 2026 and is projected to grow to roughly ₹11.18 lakh crore by 2030. The same organisation says cut and polished diamonds remain the biggest export category, but silver jewellery also retains a significant position in the sector. Even so, the Silver Institute has warned that global silver jewellery demand may fall for a second straight year in 2026 as record prices curb consumption in major markets, including India. That tension between rising interest and expensive bullion suggests the festive season may prove less about a broad recovery in demand than about a reshuffling of spending from gold towards silver.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
