Heavy investments, problems in West Asia and a rising demand among industrial units have been pushing up the price of silver in recent times.
In late February, silver saw a big hike in price following unrest in West Asia.
Experts said that owing to violence and unrest in Egypt and Libya, people started shifting their investments from crude oil to silver, thereby pushing up its price.
"Worldwide silver has given twice the returns in the last one year and investors are more inclined towards it," said Suresh Hundia, president emeritus of Bombay Bullion Association.
He added that because of the ongoing problems in Libya, the price of silver continued to be high.
"If the problem in Libya is solved, the price will come down," Hundia said.
"Silver has a huge demand in various industries," said Kumar Jain, vice-president of Mumbai Jewellers' Association, who also owns the Umedmal Tilockchand Zaveri jewellery store, pointing out a further reason.
Citing another reason he said gold comes back into the market by those who keep it for years and is recycled into fresh jewellery, but that is not the case with silver.
"Because silver is used in industries it does not come back for recycling, creating fresh demand," Jain said. He said in the gray market, there was huge betting on silver, further pushing up its price.
"Also, silver is not available in the gray market anymore because it is picked up the moment it comes," Jain added.