Silver's shine here to stay, says Vedanta Chairman Anil Agarwal after 125% jump in 2025

Silver, often overshadowed by its glittering counterpart, gold, has recently commanded significant attention due to its surging prices, driven primarily by an unprecedented technology-led demand. Vedanta Chairman Anil Agarwal's assertion of silver entering a 'structural upcycle' underscores a fundamental shift in its market dynamics, moving beyond mere speculative trading to a sustained demand trajectory. The reported 125% surge in 2025, while a hypothetical future scenario in the article, serves as a powerful illustration of this growing trend and its profound implications for the Indian economy and major players like Vedanta.

Historically, silver has played a dual role: a precious metal for adornment and investment, and a critical industrial commodity due to its unparalleled electrical and thermal conductivity, as well as its photosensitivity. In recent decades, its industrial applications have expanded dramatically. The current 'structural upcycle' is primarily fueled by the rapid expansion of sunrise industries. Key among these are the solar energy sector, where silver paste is essential for photovoltaic cells; the burgeoning electric vehicle (EV) industry, which utilizes silver in various electronic components and battery connections; and the rollout of 5G technology, which demands silver in connectors and switches. Medical applications and consumer electronics further bolster this demand. This shift signifies that silver's value is increasingly tied to technological progress and green energy transitions, rather than just its traditional role as a safe-haven asset.

For India, this trend holds immense economic significance. Hindustan Zinc Limited (HZL), where Vedanta holds a majority stake, is India's largest and one of the world's leading integrated producers of zinc, lead, and silver. A substantial 40% contribution to HZL's profits from silver highlights its critical role in the company's financial health. This, in turn, strengthens Vedanta's overall earnings diversification and margins, providing stability and growth opportunities for a major Indian conglomerate. Increased profitability for such core sector companies translates into higher tax revenues for the government, potential for increased capital expenditure, job creation, and enhanced shareholder value. Furthermore, a robust domestic silver mining and processing industry can contribute to India's 'Make in India' and 'Atmanirbhar Bharat' initiatives by reducing reliance on imports for critical industrial inputs and potentially boosting exports of value-added products.

From a policy perspective, the management and development of mineral resources in India are primarily governed by the central government. **Entry 54 of the Union List (Seventh Schedule) of the Indian Constitution** empowers the Union Parliament to legislate on the 'regulation of mines and mineral development.' This legislative power is exercised through the **Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act)**, which is the principal legislation. The **National Mineral Policy 2019** further articulates the government's vision to ensure sustainable mining, enhance domestic production, and reduce import dependency. The burgeoning demand for silver underscores the need for efficient implementation of these policies, streamlining clearances, promoting exploration, and encouraging responsible mining practices. Environmental considerations, governed by acts like the **Environmental Protection Act, 1986**, are also crucial, as mining operations must balance economic benefits with ecological preservation.

The future implications of this structural upcycle are manifold. The sustained demand from green technologies suggests a long-term bullish outlook for silver prices. However, challenges remain, including the capital-intensive nature of mining, the need for technological advancements in extraction and processing, and the imperative to adhere to stringent environmental norms. India's focus on renewable energy targets (e.g., 500 GW of non-fossil fuel capacity by 2030) and EV adoption (e.g., target of 30% private car sales as EVs by 2030) will further solidify domestic demand for silver. Therefore, a strategic approach involving government support for exploration, investment in advanced mining technologies, and promotion of circular economy principles (recycling silver from electronic waste) will be crucial to capitalize on this silver boom and ensure sustainable growth for India's economy and its key industrial players.