Silver Production in India, Industry, Consumption, Govt Policies

In India, Silver has great importance in aspects of Cultural, Economic, and Strategic, especially in Rural Areas where it is preferred over Gold for savings and rituals. Although India is not in the list of Major Producers of Silver Globally but is one of the largest consumers. According to the World Silver Survey 2023 conducted by The Silver Institute, India had about 25% of Silver demand in 2023. This highlights the growth in need of Silver for domestic, industrial and Economic purposes.

Silver Production in India

Although silver production is limited in India as compared to the demand, it plays a great role in mining sectors. The metal is largely obtained as a by-product during the refining of lead, zinc, copper, and gold ores. India’s primary silver production comes from Rajasthan, with other contributions from Jharkhand and Andhra Pradesh. According to the Indian Bureau of Mines (IBM) Annual Report 2023, India produced nearly 700 tonnes of silver in 2022 to 2023. With growth in Industrial demands in the sector of electronics, solar panel, energy storage, etc. the Silver Sector in India is strategically gaining importance.

Silver Production in India Overview

The Comprehensive overview of the Silver Production in India is tabulated below highlighting major aspects of the Metal and its features.

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History of Silver Mining in India

Silver Mining in India dates back to the Ancient Times where it had been used for ornamental, rituals and minting purposes. With time under Mughal Rule, Silver Coins had become a major currency. Further, British East India Company also relied on Silver for trade and economic exchanges. Modern silver mining began with the discovery of rich lead-zinc deposits in Rajasthan, particularly in Zawar and Rampura Agucha mines, which also yield silver as a by-product.

Major Silver Producing States in India

Silver Production in India is majorly concentrated in a few areas, basically Rajasthan followed by some extractions from other mines in few states of India. The key areas that are important for the production and extraction of Silver in India are:

• Rajasthan: It is the largest producing state of Silver in India. The Silver Mines in Rajasthan are- Rampura Agucha, Zawar, Rajpura-Dariba, and Sindesar Khurd.

• Jharkhand: Silver is extracted from lead and copper mining areas, particularly in Singhbhum.

• Andhra Pradesh: Khetri copper belt and other mineral-rich regions produce silver as a by-product.

• Karnataka: Minor production through gold and copper mines.

Industries in Silver Production

The majority of India’s Silver Production is controlled by HZL with few contributions by other companies as well. The leading companies producing Silver in India are listed below:

1. Hindustan Zinc Limited (HZL): A subsidiary of Vedanta Group, it is India’s largest silver producer, contributing over 90% of total output. Its Rampura Agucha and Sindesar Khurd mines are among the world’s richest zinc-lead-silver deposits.
2. Hutti Gold Mines (Karnataka): Produces small quantities of silver as a by-product.
3. National Mineral Development Corporation (NMDC): Indirectly linked to silver extraction in polymetallic mines.

Silver Production vs. Consumption in India

India produces far less silver compared to its consumption based on the comparison of the survey reports as published for World Silver Survey 2024. India’s silver imports surged in 2022-23 due to rising demand in solar photovoltaic (PV) cells, electronics, and jewelry. According to the Ministry of Commerce and Industry (GoI), silver imports were worth ₹54,000 crore in FY23, showing its economic significance. Over 7,000 tonnes of Silver was imported in 2023 from Hong Kong, UK, and Switzerland.

Comparison Table for Silver Production vs Consumption in India:

Government Policies for Silver Production

The Government of India has initiated several measures to boost the exploration of mines and minerals so as to reduce the import dependency. These initiatives are expected to push domestic companies to explore new reserves and expand production:

• National Mineral Policy, 2019: Encourages private participation in exploration.
• Atmanirbhar Bharat Mission: Focus on reducing import dependence for strategic minerals including silver.
• FDI in Mining Sector: 100% FDI allowed in exploration and mining under automatic route.
• Solar Energy Mission (MNRE): Expected to drive silver demand due to use in PV cells.

Applications of Silver in India

Silver is used in several sectors in India. This makes the metal highly important economically as well as strategically. Few of the uses and importance are listed below:

• Jewelry and Silverware: Rural households hold silver as a store of value.
• Coins and Investment: Silver coins and bars are popular during festivals and weddings.
• Electronics and Electricals: Used in conductors, circuits, and mobile phones.
• Solar Energy: Silver paste is essential in photovoltaic cells, boosting demand in renewable energy.
• Medical and Industrial Uses: Silver nanoparticles are used in medicine, water purification, and antimicrobial applications.

Global Context of Silver Production

The top producers of Silver in the world are- Mexico, China, Peru, Russia, and Australia. India is not among the top 10 producers but ranks among the top 3 consumers. According to the World Silver Survey 2024, global mine production was around 26,000 tonnes in 2023, showing India’s share is very small, highlighting the dependency of India for Silver on imports.

Future Prospects of Silver Production in India

The demand for Silver in India is expected to grow due to the rise in renewable Energy, Electronics, Solar Energy, Investment, etc. According to the International Energy Agency (IEA) the Solar Power Expansion will significantly boost the consumption of Silver in India. Exploration of new deposits in Rajasthan, Jharkhand, and Chhattisgarh, along with recycling and refining, can help India reduce its import dependence.

Challenges in Silver Production in India

Despite Rising Demands, India faces several challenges in the production of Silver. Few of the major challenges are listed below:

• Limited Primary Silver Ore Deposits
• Heavy dependence on by-product mining of lead-zinc
• High Reliance on Imports affecting Trade Balance
• Rising Global Price impact Domestic Industries
• Lack of Technological advancement in Refining and Mining Industry

Way Forward

India’s silver production faces the dual challenge of limited domestic reserves and heavy import dependence. To overcome these issues, a balanced approach combining exploration, technology, and policy support is required. Strengthening the domestic mining sector, diversifying sources, and boosting recycling can reduce reliance on imports and secure supply for industries like solar energy and electronics.