India's gem & jewellery exports have been picking up since the start of the year and have maintained the momentum through the first half of the fiscal year. During April to September 2021, the overall gross exports of gems & jewellery recorded a growth of 11 per cent to Rs 1,40,413 crore (or +5.13 per cent in dollar terms to $18,984 million) as compared to April-September 2019 of Rs 1,26,462 crore ($18,058 million).
The sector has already achieved nearly half (46 per cent) of the $41.66 billion exports target set by the government. The sentiment in the industry is incredibly positive with markets opening up and demand gradually returning to normal. The industry body Gems and Jewellery Export Promotion Council (GJEPC) successfully concluded the International Gem & Jewellery Show (IGJS) in Dubai recently. With the festive season coming up, the sector is optimistic of achieving the export target by the end of the financial year.
Colin Shah, Chairman of the GJEPC, talks about growth in the jewellery sector and new trends. Excerpts:
How is the jewellery market in India doing?
Currently it is doing extremely well. It was obviously sluggish in April, May and June. July was also slow. But August onwards from Rakshabandhan it has really picked up. And the way things are going we should be back to pre-pandemic levels by March 31.
Last year during the pandemic, the domestic market was 25-30 per cent down. Exports were also down, but now we are growing over the pre-pandemic levels. All numbers are in comparison to 2019.
Weddings have become smaller. Is that impacting the jewellery market?
Surprisingly no. People are spending more on jewellery post the pandemic than they did even pre-pandemic. May be because whatever they are saving on the big wedding in terms of feeding people etc., they are spending on jewellery. That is why we are seeing this surge in demand. 60 per cent of the demand in the domestic jewellery market is because of weddings.
What are the trends in the jewellery industry?
Earlier large consumption came from the metro cities. That would be the top 6 cities and another 10 towns after that. So the top 15-20 cities of the country were responsible for 60-70 per cent of the consumption. That was five years back. Today there are around 500 towns where the consumer wants to buy the good things in life and that is the big opportunity for the gems and jewellery trade.
There is a lot of wealth creation that has happened in these towns. Consumers are buying everything from light weight jewellery to heavy sets. Diamond jewellery is rising because now even in tier-3 and tier-4 towns the younger generation wants a diamond engagement ring. Things continue to do well and there is no reason why India will not be a $100 billion market in 4-5 years.
With gold prices going up, was there an impact in the market?
In the short term there is always an impact with the price of gold going up. But increasing prices also create a lot of confidence in the category. Gold is a good storer of value. So, I don't think gold prices increasing is a negative, I think it is a positive.
What are the expectations from gems and jewellery export?
We are around a $40 billion industry right now. We should be $65-70 billion in the next 3-4 years unless there is another global pandemic.
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