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India
By Zainab Morbiwala
The dynamics of the Indian diamond industry remain unchanged for May. Demand remains steady in the country, while internationally India has seen positive demand from the U.S. and the Middle East.
Citing the demand dynamics, Ghanshyam Dholakia, founder and managing director, Hari Krishna Exports, shares, “The demand for diamonds in terms of cut, color and carat has remained more or less the same. No sharp shifts were observed. The ongoing diamond size all over India is .10 carats and below.” Regarding the international market, Dholakia adds, “Business is great in Hong Kong and good in Europe and the Gulf. As for Japan and China, we are witnessing steady business from those regions as well. In the U.S., the mom-and-pop stores are doing good business compared to retail chain stores. The preferred size in the U.S. is 1 carat up. Overall, the diamond industry is growing worldwide but the industry definitely needs more advertising.” Adding further, he shared, “The indifference in polished sales is prolonged; there is demand for products, but the price mismatch between expected polished price acts as a dampener to finalization of the deal.”
The demand for diamond jewelry continues to be very low. Given that jewelry is still seen as an investment, the prevalence of gold jewelry takes precedence over that of diamond jewelry. Achal Gupta, jewelry designer and director, Rivierea, The Jewellery Hub, comments, “Due to constant changes in the urban lifestyle, the taste and preference of the people are also changing gradually. Diamond jewelry is a niche segment and the brand has to follow the consumers’ aspirations very strictly. And, beyond the look-good factor, the feel-good factor plays a more subtle role among the modern and educated women in the selection of diamond jewelry.” Elaborating on the design aspect, Gupta notes, “Today, Indian consumers are inspired by Western designs and they are more inclined to statement ensembles. Big pieces are no longer considered better and beautiful, while small-sized diamonds are preferred by young women in metropolitan areas. Customer demand has increased for diamonds with certificates from specified and reputable laboratories.” Breaking down the demand within the different regions of the country, he says, “Consumers of North India are ahead of other regions in terms of quantity, while the South Indian consumers are more quality conscious. Customers in South India prefer maximum D, E, F colors along with VVS clarity. On the other hand, customers in North India demand more of G, H, I color along with SI1clarity. In today’s scenario, the concept and designs of diamond jewelry are changing very fast.”
Highlighting the challenges being faced by the industry within the country, Gupta minces no words: “Two important factors are affecting the demand for diamond jewelry in the domestic market. First, there is no uniform certification standard among various laboratories, with the grading of color and clarity of the same diamond differing from lab to lab. The second challenge is that there is no standard pricing format for diamonds as there is for gold for the end customers; the same size diamond with the same laboratory certificate is available at different prices in the market.” Gupta also points out that the domestic diamond industry is being plagued by chemical vapor deposition (CVD) diamonds. According to Gupta, the only way to deal with this particular issue is by either banning CVD diamonds in the domestic market or making sure the marketing of the CVD stones is properly regulated and they are sold as a different commodity, like cubic zirconia (CZ). He adds, “Accurate market forecasting by traders and jewelers and more liberal policies by the government can help the industry to overcome these current challenges.”
Ecommerce in India has been taking the market by surprise with niche players and categories going online. Book My Diamond Pvt. Ltd, a Mumbai-based company that buys loose diamonds from manufacturers and sells them to jewelers through an app, has been able to raise funding from three individual investors. Book My Diamond allows jewelry retailers to search its live inventory of loose, certified diamonds and buy them. In a recent media interview, Sankalp Goyal, co-founder, shared, “Our trade platform offers live prices of diamonds as they keep changing depending on the U.S. dollar market. Retailers do not need to stock inventory and the virtual inventory on the Book My Diamond app gives them enough range to show it to end-customers.” Goyal plans to go global after strengthening the company’s presence in India. Industry experts are optimistic about good growth in demand for diamonds and diamond jewelry across the globe. Gupta concludes, “The global market is growing splendidly as the ratio of first-time diamond purchasers is increasing rather sharply, especially in China, India and Middle East. The U.S. and European markets are expected to grow as well.Article from the Rapaport Magazine - June 2017. To subscribe click here.
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