The silver paste is mainly for static and some times touch. Its very important to put that silver paste back on. Here is a link of a video which talks about silver paste. Could also be the LCD ribbon cable and connector that could also affect the touch function open the phone and exam the LCD connectors on the board as well as the screen and check for signs of damage or missing pin connectors.
https://www.youtube.com/watch?v=BseVXodqHao