Silver ETFs In India Explained

Last Reviewed and Updated: 17 Aug 2026

Silver ETFs are a recent addition to the Indian market. Nippon India Silver ETF, the oldest in the category, launched in January 2022, with Axis Silver ETF following in September 2022 and Kotak Silver ETF in December 2022.

SBI Silver ETF arrived considerably later, launched in July 2024, and has still grown quickly despite the late start. As of 2026, India has more than 9 silver ETFs available, a genuinely young category compared to gold ETFs, which have existed in India since 2007.

Silver ETF assets under management grew from roughly Rs 15,339 crore in March 2025 to well over Rs 1 lakh crore within about a year, with net inflows in FY26 alone exceeding Rs 30,000 crore, more money than the entire category was worth at the start of that same year.

Daily turnover crossing Rs 4,200 crore has been read as a sign of a maturing market, though that figure can fall sharply if sentiment turns.

In FY26, commodity ETFs, gold and silver combined, attracted more new money than equity ETFs in India, a genuine shift in how Indian investors have been using the ETF structure, not simply a continuation of an existing trend.

Metric	Figure
Silver ETF category AUM, March 2025	Roughly Rs 15,339 crore
Silver ETF category AUM, roughly one year later	Over Rs 1 lakh crore
Silver ETF net inflows, FY26	Over Rs 30,000 crore

Investors put more new money into silver ETFs in a single year than the entire category had been worth at the start of it. That is not gradual growth. That is a category being discovered all at once.

Why Silver Behaves Differently From Gold

Gold's price is driven overwhelmingly by safe haven and monetary demand. Silver carries that same driver alongside a genuine industrial one, since silver is a real input in solar panels, electronics, electric vehicles, and electrical equipment, with global industrial silver demand projected at roughly 650 million ounces in 2026.

That dual exposure, financial sentiment plus industrial demand cycles, is why silver is consistently described as more volatile than gold, moving on economic data and industrial activity in a way gold generally does not.

The Gold Silver Ratio, measuring how many units of silver it takes to buy one unit of gold, is a commonly used indicator here: when the ratio runs historically high, meaning silver is cheap relative to gold, silver has tended to catch up rapidly in the periods that followed.

Given its higher volatility relative to gold, silver is commonly suggested as a satellite allocation, roughly 5% to 10% of a portfolio, rather than a core holding an investor builds a portfolio around.

That framing reflects silver's dual demand character directly: a useful diversifier alongside equity and debt, not necessarily a foundation to replace either.

Silver ETFs are commonly cited with a short term capital gains treatment for units held 24 months or less, taxed at the investor's slab rate, and a long term treatment only beyond that 24 month mark, taxed at a flat 12.5% without indexation.

This differs from gold ETFs specifically, which moved to a shorter 12 month long term threshold following a Finance Act 2025 amendment covered in our earlier Gold ETF article.

Not every source describes gold and silver ETFs identically on this point, and given how recently and unevenly this area has changed, confirming the current rule for your specific fund is worth doing directly rather than assuming the two commodities are taxed the same way. Silver ETF transactions do not attract Securities Transaction Tax or GST.

	Silver ETF	Gold ETF
Long term capital gains threshold	Commonly cited as beyond 24 months	Beyond 12 months, following a Finance Act 2025 carve out
Long term capital gains rate	12.5%, no indexation	12.5%, no indexation
Short term capital gains	Slab rate, up to 24 months	Slab rate, up to 12 months

What To Actually Check Before Choosing One

● Physical silver holding and purity. SEBI requires a high minimum purity standard, commonly cited at 99.9%, and the fund's actual physical silver percentage is disclosed in its factsheet.

● Tracking error and tracking difference, covered in more depth in our earlier article on NAV and tracking error. One real fund's 1 year tracking difference has been reported at roughly negative 4%, not fully explained by its own 0.41% expense ratio alone, cash holdings, operational costs, and valuation timing all contribute.

● Access route. The ETF itself requires a demat account like any other ETF in this series. A Fund of Funds version built around the same underlying ETF typically does not, and can support a SIP from as little as Rs 100 a month through an ordinary mutual fund app.

Note: Silver ETF category assets grew from roughly Rs 15,339 crore in March 2025 to well over Rs 1 lakh crore within about a year, a scale of growth worth treating as current news rather than settled history. One genuine nuance worth flagging directly: silver ETFs are commonly cited with a 24 month holding period for long term capital gains, different from gold ETFs, which received their own carve out to a 12 month threshold following a 2025 amendment covered in our earlier article on Gold ETFs versus Sovereign Gold Bonds. Do not assume gold and silver ETFs are taxed identically without checking the current rule for the specific fund you hold.

This article is for general informational purposes only and does not constitute investment or tax advice. Silver ETFs are subject to price volatility from both precious metal and industrial demand cycles, and past performance is not indicative of future results. Tax treatment described here reflects rules understood as of July 2026, is genuinely evolving, and should be confirmed against a specific fund's current classification before investing. Consult a qualified financial adviser or tax professional for guidance specific to your situation.