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India
By Zainab Morbiwala
The slump the market is witnessing is a positive correction, with the demand for rough showing signs of improvement and the streamlining of polished inventory.
Speaking exclusively with Rapaport Magazine, Praveenshankar Pandya, chairman, Gem & Jewellery Export Promotion Council (GJEPC), explained, “The month of February was just right in terms of demand and supply for rough. In fact, after the self-discipline shown in the production of polished, there has been a demand for rough and the market is looking for rough at the moment. Polished inventory is in the process of being streamlined and the industry is bearing the fruit of the decline in manufacturing during the last quarter of 2015. This has brought about a balance between the supply and demand for polished. But yes, in certain segments, we do see an excess, especially in better goods. However, things are in control and we can expect a positive 2016 for the industry. We see manufacturers preparing for the year ahead.” Pandya also noted that there is now some shortage in piqué goods. Reiterating Pandya’s point that the industry is reaping the fruits of the lowered production in the past four to five months, Dinesh Navadia, president, Surat Diamond Association (SDA), summed up the current market dynamics: “The market is in a positive phase currently. If manufacturers restrain themselves the way they have done for the past couple of months, we are sure that 2016 is going to be a good year for the industry.” Navadia revealed that signing companies up for the Surat diamond bourse was in full swing and the bourse would be operational in another two to three years. As part of an ongoing initiative, SDA will be holding seminars to acquaint its members with the rules and regulations of the Goods and Service Tax (GST), which is expected to be implemented across the country this year.
The announcement by the government to require the implementation of the Permanent Account Number (PAN) of any individual purchasing jewelry above Rs. 2,00,000 — approximately $29,200 — has not been well received by the industry. To make their case to the government, jewelers in Surat staged a one-day strike on February 10. The strike was supported by the Surat Jewellers’ Association (SJA), the All India Gems & Jewellery Trade Federation (GJF) and the SDA. In fact, members of the SDA showed solidarity with the striking members by staying away from trading in polished diamonds for the entire day. Furthermore, given that the price of gold is almost at $438 for 10 grams, the PAN regulations will make an impact on the industry, especially with the wedding season in India just around the corner.
In a recent press statement, the Gem & Jewellery Skill Council of India (GJSCI), announced it had signed a memorandum of understanding (MOU) with the Maharashtra State Skill Development Society (MSSDS) to explore a collaboration for increasing employment potential in Maharashtra by developing a supply of skilled manpower. The MOU also states that MSSDS, along with GJSCI, would undertake the training of 12,000 young girls from remote areas starting in the next two years. Furthermore, additional training and improvement in the working conditions of the artisans in the gem and jewelry sector will be routed through GJSCI. This move is aimed at strengthening the polishing industry as well as the jewelry industry and expanding the existing workforce. In February, the GJEPC presented two shows: the ninth edition of the Signature India International Jewellery Show (IIJS) and the third edition of India Gem & Jewellery Machinery Expo (IGJME). Both shows met with a renewed and positive response this year, with visitors at IIJS also including many mom-and-pop jewelry stores in India. IIJS saw a 10 percent increase in preregistration as compared to 2015; the number of overseas visitors rose by 20 percent. Speaking at the inauguration of IIJS, Pandya shared that the council plans to integrate the small and medium enterprise (SME) manufacturers of gold and diamonds under one roof in a state-of-the-art Jewellery Park in Maharashtra.
The ecommerce boom in India is making players from the gem and jewelry industry pay heed to the changing dynamics of shopping in India, which is applicable to jewelry as well. Dedicated portals like Jewel Hub, Carat Lane, BlueStone, among others, are luring customers with offers and discounts on diamond jewelry. Recently, one of the oldest names in jewelry, Tribhovandas Bhimji Zaveri (TBZ), also joined the bandwagon with an online presence. The jewelry is currently selling through two portals, Snapdeal and Flipkart. At the Hong Kong International Jewellery Show this month, Kapu Gems launched a new website and mobile application. Besides facilitating the buying of certified diamonds, the high-definition video feature will enable buyers to have an accurate view of the items they would want to purchase. According to the company spokesperson, “A new thoroughly detailed matched pair section will address the retailers’ universal challenge of making the right matched pair of diamonds.”Article from the Rapaport Magazine - March 2016. To subscribe click here.
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