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When Satyaprakash Pande of Dheersons Jewellers sees an individual approaching his shop located in the bustling Karol Bagh market in central Delhi, he becomes hopeful of getting a customer -- an entity that has become rare in the last few weeks.
With hardly three-four customers a day, Pande terms the situation "unprecedented" as he has never witnessed such a slowdown in his business. He recalls how busy he was attending to the rush of customers in November last year, which marks the beginning of the wedding season.
"I have never seen the streets in the market wearing a deserted and forlorn look even during the off-season. Despite being the wedding season, just three to four customers are visiting my shop. My business has gone down by almost 90 per cent after the demonetisation announcement," Pande said.
The situation is almost the same for jewellers across the country, whose businesses have come to a standstill since November 8 when the Rs 500 and Rs 1,000 notes -- accounting for 86 per cent of the currency in circulation by value -- ceased to be legal tender.
The (GJF), a self-regulatory body established by the jewellers, put the losses at 85 per cent.
The federation said that the annual business had touched Rs 480,000 crore ($70 billion) before the demonetisation move. Post-demonetisation, the federation says it has recorded a loss of Rs 30,000 crore in just the last 20 days.
"We welcome the demonetisation move as it aims at wiping out corruption from our country. Since there is lack of cash in the system, the business is witnessing a slowdown. Despite being the wedding season, jewellers have recorded about 85 percent dip in footfalls," GJF chairman GV Sreedhar said.
There are about 4,50,000 jewellers across the country and around 60 million people are connected to the business as artisans, polishers, die makers, transporters and the like.
Last year, the annual exports of gems and jewellery from India hit $40 billion, and trade bodies expect that exports this year would remain unaffected. Diamonds form the largest chunk of the exports.
"There is negligible impact on the export business, chiefly because we receive payment from overseas. There are chances that the Small and Medium Scale Enterprises (SMEs) might have been affected due to the liquidity crunch. However, there should not be a problem if payments (to artisans, workers) are made online or directly to bank accounts," Praveen Shankar Pandya Chairman, Gem and Jewellery Export Promotion Council, said.
Sreedhar hoped that the demonetisation and digitisation plans would bring transparency in business transactions, but said that jewellers would continue to incur losses, till such time enough cash is brought into circulation.
"The most affected elements in the jewellery trade are artisans and labourers, who have moved to their hometowns since jewellers cannot pay them their daily wages due to the cash crunch. They do not accept payment online. In addition, customers are not ready to spend the cash they have on jewellery at this moment. So we are anticipating the slowdown to continue until there is adequate cash in the system," Sreedhar said.
According to information shared by the jewellers' organisations, Mumbai is the largest hub in the country and its business volume is about 30 times that of Delhi.
Immediately after the demonetisation announcement, prices of gold had shot up to Rs 52,000 per 10 grams, compared to the usual market rate of Rs 30,000 as many rushed to jewellers to convert their high denomination notes into a safe haven asset, according to reports.
However, subsequent inquiries and raids by Income Tax officials instilled fear among jewellers, who chose to keep their shops shut for several days.
According to a jeweller in the Chandni Chowk market, some jewellers had not opened their shops so far, fearing action by IT officials.
"There should not be any objection to strict action against those who indulged in grey-marketing. However, random raids have sent chills down the jewellers' spines. Many have kept their shops shut for the last many days due to fear," the jeweller said, speaking on condition of anonymity.
Many jewellers expressed concern over the adoption of digital transaction systems, fearing an increase in prices. However, the move found many takers who thought it would be helpful in the long term.
"No doubt, it will bring much-needed transparency. Initially, jewellers and customers, who do not want bills, may have problems. However, they will have to accept it in course of time. It is good for the country in the long term," said another jeweller, with a mischievous smile on his face.