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India
By Zainab Morbiwala
The Indian gems and jewelry industry remains at a standstill without much activity or demand, either from within the country or internationally. Still, the mood in the market got a boost from the news that the proposed 2013-2014 Union Budget included some high-priority requests from the gems and jewelry industry.
Sharing his views on the budget, Bachhraj Bamalwa, chairman of the All India Gems and Jewellery Trade Federation (GJF), said, “Going by the negative comments by the government over the past few months concerning gems and jewelry, the industry was skeptical about the budget. But, to our relief, the finance minister agreed to some of our recommendations.” Among them was an increase in the duty-free gold import limit to approximately $2,000. Haresh Soni, who was scheduled to take over as GJF chairman on April 1, after press time, added that “Our recommendations included no hike in excise duty, no increase in import duty on gold, a request for a commodity transaction tax” and an increase in the gold import limit. “All four of these requests have been accepted in the budget,” said Soni. “This is good news for the entire industry.” The industry’s apex body — the Gems and Jewellery Export Promotion Council (GJEPC) — was disappointed that the budget does not include any of its recommendations for creating an international diamond trading hub in India. But Vipul Shah, chairman of GJEPC, said in a press statement that “The council appreciates the move to set the curriculum and standards for training in different skills under the National Skill Development Corporation (NSDC).” Shah also noted that his organization was pleased with the $180 million funding for the training programs, which will reward graduates with a certificate and a cash prize of approximately $200 on successful completion of the course. For the gem and jewelry sector, Shah said, “NSDC has already set up the Gem & Jewellery Skill Council of India (GJSCI), in collaboration with GJEPC, to develop skilled manpower for the sector.”
In assessing the current market, Sanjay Shah, director of Gold Star Diamond Pvt. Ltd., said, “Internationally, the demand for commercial goods is still higher. Demand has not slowed down for I-plus color and I2-plus-to-SI3 clarity, mainly in white natts in .18-point size and down. In certified goods, dossiers in VS to SI are doing well, while VVS is still tough to sell and even available at discounts. SI is slow, due to weakness in the European market. Overall, demand for price-point goods is the strongest product sector.” As for demand from within the country, Sanjay Shah said, “VVS is slow, while SI is doing better from white to the top light brown (LB) shade. Demand is slow for certified goods.” On a pessimistic note, he added, “Though the demand has not yet picked up at retail, we see prices on loose diamonds going up. I do not see this as a good sign because every time prices have increased, we have witnessed a fall in demand. We need to have stability for at least one year in rough and polished prices to ensure consumers are back before we start to push the prices again, especially since Europe is still very slow.”
A wedding without jewelry is inconceivable in India, where the preference still is for gold jewelry. It is expected to take some time before diamond jewelry takes center stage in the country. “Unlike overseas, in India, it is not only customary but also religious to wear jewelry in weddings,” said Navin Sadarangani, director of NYUZ, a jewelry retail service provider. “A nice blend of gold, polished and uncut diamonds and various colored stones — selected for tradition and their everyday wearability — make up bridal jewelry in India. This is not the case in other parts of the world. Some countries focus on more diamond-intensive designs and others on more gold-intensive designs. A nice blend happens only in India.” Sadarangani said the Azva collection of wedding jewelry by the World Gold Council has been marketed very effectively by focusing on the seven marriage vows. He expects the collection to renew enthusiasm for gold, especially among younger consumers who might be inclined to consider gold old-fashioned. “Many new brides are choosing solitaires for their bridal rings and platinum is also the preferred choice for the engagement and wedding rings,” said Sadarangani. “Men who have never worn jewelry before have started experimenting with platinum bands.” As for the global market, Sadarangani conceded that “In terms of design, Indian bridal designs are less popular than Indian fashion and trendy designs in major international markets like the U.S. and Europe. Indian designs are known for their heritage, tradition, intricate designs, craftsmanship and ethnicity. There are very few countries in the Middle East and Asia where Indian bridal jewelry has made much of a mark.”Article from the Rapaport Magazine - April 2013. To subscribe click here.
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