 "Christmas jewellery export orders dip 25%")
Overseas orders for Indian jewellery have declined by 25 per cent for the Christmas season because of a global economic slowdown.
Indian jewellery manufacturers were hoping for strong Christmas sales on reports of a revival of economic sentiment in the US, consumer of around a third of global jewellery production, to which India contributes nearly 40 per cent.
The season starts with Thanksgiving in the last week of November and continues until the New Year. Jewellery sales during these five weeks contribute nearly 40 per cent of annual sales.
"Jewellery export orders are around 75 per cent of the normal. The US has shown little sign of recovery and orders from the rest of the world are weak," said Praveen Shankar Pandya, chairman, Gems and Jewellery Exports Promotion Council (GJEPC).
The slowdown in jewellery demand overseas has reflected in exports, which declined 13 per cent during April-October to $18.09 billion from $22.15 billion in the same period last year. Imports of rough and polished diamonds, likewise, declined by 29.73 per cent to $13.73 billion during April-October from $19.55 billion in the same period last year.
"While the US has seen slight growth in mid-size jewellery orders, demand from other markets like Europe and the Far East is weak," said Mehul Choksi, managing director, Gitanjali Gems. Prices of gold and rough diamonds have declined by 5-10 per cent in the past month. Processors and dealers have also cut prices of polished diamonds. But lower prices are not percolating into jewellery demand.
"The domestic market has also seen a sharp decline in jewellery consumption," said Shreyas Doshi, chairman, Shrenuj & Company Ltd.
The GJEPC has urged the government to help the jewellery industry with an interest subvention scheme. Indian jewellers need to offload three months of extra inventory in the global markets in two months. "This inventory carries costs bearing which Indian exporters will be unable to compete against players in Belgium and China," Pandya said. In a separate development, India Diamond Trading Centre (IDTC), the country's first special notified zone, completed its test shipment to Rio Tinto today. Set up by the GJEPC in collaboration with Bharat Diamond Bourse, the zone will help small diamond companies source roughs directly from miners.
IDTC will conduct weekly viewings and auctions of rough diamonds. IDTC's viewing slots are booked till December 2016 by major trading companies like DTC, Dominion Diamond Corporation and Rio Tinto.
