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India
By Zainab Morbiwala
Known as the festival of lights, Diwali is one of the most important festivals in India. For the gem and jewelry industry, this year’s Diwali seems to have brought in a lot of cheer, with demand from within the country showing considerable signs of improvement. The icing on the cake has been the generic promotion campaign for diamonds by the Gem and Jewellery Export Promotion Council (GJEPC) and De Beers. The campaign is expected to further push demand for diamonds in the market. The campaign is targeted toward women between the ages of 25 to 35 and is expected to run for three months across television, print and digital media. In a press statement, Stephen Lussier, CEO, Forevermark, shared that De Beers has been working closely with the GJEPC to develop a category-based marketing campaign during the 2016 key selling season in India. “India continues to be one of the top performing markets where diamond consumption is concerned,” he said. “It is thus imperative to protect and grow diamond equity and this will require a sharp focus on consumer confidence and consumer demand.” An exclusive portal has been designed for the campaign, where customers can find the retailer’s name, address and contact numbers.
In an excusive interview with Rapaport Magazine, Dinesh Navadia, president, Surat Diamond Association (SDA), noted, “We see a lot of optimism in the industry this festive season. The demand for melee and diamonds above 11+ is strong. The demand from within the country is also very good.” According to industry sources, October saw a very positive response for diamonds, not just from the U.S. but also China, Hong Kong and Japan. Keeping the demand in mind, many diamond unit owners are expected to cut short the Diwali holidays to fulfill the orders for the upcoming Christmas demand from the West. Adding to this, Ashok Minawala, director, All India Gems and Jewellery Trade Federation (GJF), reiterated the positive mood. Speaking exclusively with Rapaport Magazine, he said, “The past six months were certainly very dull for the industry. We are seeing an upbeat mood since the beginning of October. For the industry, the season runs from October through March. We usually generate two-thirds of our business during these six months. What remains to be seen is whether the sentiments that we are witnessing right now will be sustained past this six-month period. But I would like to add that I am optimistic about seeing good demand post-March 2017 as well.”
Regarding general market dynamics, Ghanshyam Dholakiya director, Hari Krishna Exports Pvt. Ltd., also in an exclusive interview with Rapaport Magazine explained, “Production was under control during 2016 due to the cooperation of mining companies in pricing and allocation of goods. As a result, this year has so far been comparatively better than the previous two years in regard to demand and actual sales.” Concerning the movement of goods Dholakiya added, “Round goods of V to I clarity, triple EX goods, in the range of .30 to 2-carats in F to J color, are moving fast. Fancy goods and round VVS in D to F color are not that much in demand.” Regarding the flow of goods seen at Hari Krishna Exports, he said, “All goods are very much in demand, unlike the past two years. Piqué color goods are again sought after in the U.S. after a long interval of sluggishness.”
In a recent development, post Diwali, diamonds are to be introduced among the list of 91 commodities that can be traded on the Indian exchanges according to an update by the Indian government. The new consolidated list of 91 commodities, which in addition to diamonds, includes tea, eggs, cocoa and brass, will now be traded on the derivatives market. The Securities and Exchange Board of India (SEBI), which is the regulator for the securities market, has asked the exchanges to take steps to amend relevant rules and regulations for implementing the exchange of diamonds and the other new commodities. While Navadia feels this would be beneficial to the industry, Minawala is not too happy with this decision. As he explains, “Diamonds are not something that fall into the category of mass-produced items. Diamonds need to be romanced; diamonds are to be cherished. To treat diamonds as a commodity will make them lose their charm. India has more than 30,000 jewelry retailers. This initiative would create chaos. The value chain cannot be jumped. The manufacturer cannot be put in direct touch with the consumer. Diamonds are not a commodity.”Article from the Rapaport Magazine - November 2016. To subscribe click here.
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