Diwali 2025: How rising silver prices impact the cost of festive sweets, kaju katli..
The festive season has arrived, and Diwali is unimaginable without sweets. Imagine, without the sparkling silver work on Kaju Katli or Gulab Jamun, there's no such charm. But this year, the sweetness of the festivities has been tempered by the rising prices of silver. The situation is such that the silver work that enhances the beauty of sweets has virtually disappeared from the market, and shopkeepers are hesitant to purchase it. On Tuesday, the price of silver work in the spot market reached a record high of Rs 1.9 lakh per kilogram, causing worry among sweetmeat traders.
This situation has become a conundrum for sweetmeat manufacturers. While the government has reduced the GST rate on sweetmeats to 5%, which should have provided some relief, the skyrocketing prices of essential commodities like silver have eroded that relief. Every shop can't purchase such expensive work, and most shopkeepers are avoiding passing on this additional cost to customers.
Skyrocketing Prices, Fading Luster
This surge in the price of silver work has directly impacted the cost and presentation of sweets. Shivam Bhagat, owner of Bhagat Halwai, an establishment more than two hundred years old in Agra, explains that a single leaf of silver work, which used to cost ₹5 last Diwali, has now risen to ₹8 this year. This represents a direct increase of nearly 60%. He says, "The GST reduction is certainly a positive step, but the constant fluctuations in the prices of essential commodities like milk, sugar, and silver are creating significant problems for businesses like us. Even recovering costs is becoming increasingly difficult." During the festive season, when sales are at their highest, such inflation erodes profits.
Inflation has dented the GST relief.
For sweetmeat traders, this situation is like "a well in front and a ditch behind." The government had given them a major gift during the festive season by reducing GST, aiming to provide affordable sweets to customers and boost business. However, the skyrocketing silver prices have dashed all hopes. Sweets sellers are in a dilemma as to how to pass on the benefits of the GST cut to customers when their own costs have increased unexpectedly. It's not just silver; transportation costs and the prices of other raw materials have also risen, significantly increasing the overall cost of making sweets.
Shopkeepers have found new ways to protect customers
Even in these difficult times, sweets sellers don't want to disappoint customers. They know that customers spend lavishly on sweets to celebrate the festive season, and they want to maintain this tradition. Mumbai's famous Parsi Dairy Farm has decided not to increase the prices of sweets. Its Managing Director, Bakhtiyar K. Irani, said that the cost of the work they purchase has increased by 10-15%, but they will bear the burden themselves. Meanwhile, Sid Mathur, founder of Khoya Mithai in Delhi, has found a creative way to address this problem. He explained that some sweets are changing or reducing the design of the work to control costs while maintaining the aesthetic appeal of the sweets. These steps demonstrate how businesses are navigating this crisis while prioritizing their relationships with customers.
Disclaimer: This content has been sourced and edited from TV9. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.
