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India
By Zainab Morbiwala
Discounting the current political instability in India, overall sentiment remains positive across various industries, including gems and jewelry. With the decline in gold prices to less than $500 for 10 grams, Indians shed their inhibitions about loosening their purse strings and started buying gold jewelry.
The first-ever India Gem and Jewellery Fair (IGJF), held in New Delhi April 12 to 15, generated good interest among industry players and the initial feedback received by the show organizer, the Gem and Jewellery Export Promotion Council (GJEPC), was positive. Vipul Shah, GJEPC chairman, said the fair “was GJEPC’s first attempt at organizing an event directly targeting consumers and we are very grateful to the India Trade Promotion Organization (ITPO) for its support in putting together one of the largest consumer jewelry shows in the country. With participants from across the country, our main objective was met, which was to engage the consumers directly and allow them to view the extensive range of jewelry, while providing the Indian gem and jewelry industry with much-needed exposure directly to consumers.” Indian jewelry designers also had an opportunity to showcase their collections to domestic as well as international jewelry retailers at the India International Jewellery Week (IIJW) held in Delhi. This is the world’s only event dedicated to showcasing jewelry that extends over an entire week. Organized by GJEPC, the event also was supported by the Indian Ministry of Commerce and Industry. Both the jewelry design showcases — IGJF and IIJW — were timed to coincide with the upcoming wedding season in India. At IIJW, Rio Tinto presented its Nazraana collection, for which the company introduced a new brand ambassador, Yami Gautam, a popular Indian actress, who modeled the jewelry at the event.
Shah appears to be carrying forward the work of his predecessors at GJEPC in organizing a wide number and variety of promotional, marketing and networking events. Another recent GJEPC initiative was a banking summit titled “Emerging Trends in Financing of the Indian Diamond Sector” that was designed to facilitate interaction and understanding between the trade and banks. Speaking exclusively to Rapaport Magazine, Shah said, “The summit was held in Mumbai with the senior officials of the Reserve Bank of India (RBI), India’s central bank, and other leading banks who are lenders to the gem and jewelry industry, along with the heads of credit institutions and the proprietors/partners/directors and financial officers of the top exporters in the Indian diamond industry.” Shah described the wide-ranging objectives of the summit as “to build greater confidence by the banks in the industry, to stage an honest dialogue of issues on both sides, to identify steps for action going forward, to assess how to better align the industry’s perceived risk to risk management guidelines and to come to a better understanding of how banks finance the industry and their internal risk management, including bonded warehouse policies. Another topic of discussion was how to understand and manage foreign exchange risks.”
With March being the end of the fiscal year in India, the gems and jewelry industry traditionally remains more or less at a standstill, with little buying or selling taking place. But this year was a bit busier than usual because of the decline in gold prices. “In March, we do not expect any real momentum but the first three weeks of April were good for jewelry sales,” Ashok Minawala, former chairman of the All India Gem & Jewellery Traders Federation (GJF) and chairman of Danabhai Jewellers, told Rapaport Magazine in an interview. “One reason is the recent drop in gold prices and the second being, of course, the upcoming wedding season.” He noted that across the country, there was a wide range of jewelry sales increases — from 15 percent to 50 percent, depending on the region — in mid-April due to the sudden drop in gold prices. “Diamond jewelry sales, too, have been encouraging, though when it comes to loose diamonds, the industry still isn’t looking too positive,” Minawala continued. “The reason for this is the instability in the prices and supply of rough.” Minawala predicted a further increase in gold and gold jewelry sales in May because on May 13, Indians celebrate Akshaya Tritiya. It is considered an auspicious holiday on which to make purchases or start new ventures. Valuables bought on this day are believed to bring good fortune and hold their value. Various manufacturers and retailers take advantage of this tradition to promote and market their gold and gold jewelry products. Shah said that the first three months of 2013 “remained good for polished diamonds due to adequate demand from the Far East, Middle East and the U.S. Overall domestic demand has remained satisfactory so far in the current year.”Article from the Rapaport Magazine - May 2013. To subscribe click here.
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