The recently concluded India International Jewellery Show (IIJS-2015) organized by the Gems and Jewellery Export Promotion Council (GJEPC) in Mumbai has rekindled hopes of the Indian gem and jewellery industry, which is going through a rough patch at present. The atmosphere at the Show was one of overall confidence towards the entire range of exhibited goods, though it was the gold jewellery section that attracted most of the visitors. This is not a new phenomenon, as it has always been the case as gold jewellery retailers go ‘shopping’ during the IIJS Show to stock up for the festival season that is just round the corner.
At the inauguration function of IIJS 2015, it was heartening to hear Chief Guest, Mrs. Rita A. Teaotia, Commerce Secretary, Minister of Commerce & Industry, Government of India, Mrs. Rita A. Teaotia say that the Indian gem and jewellery story is built on a strong foundation of India’s love for jewellery, which is evident from the performance and resilience that the sector has shown over a period of time. She also reiterated that the Indian government has been supportive and will give continued to be so to the gem and jewellery industry. Suggesting that the sector should work with financial institutions to build confidence and conduct genuine business to safe guard industry’s image, she said the Government of India had moved very quickly on the industry’s SNZ demand; and that the execution is already underway and it may announce reasonable and rationale taxation norms for the industry in due course of time. In his address, Guest of Honour, Paul Rowley, Executive Vice President, De Beers, Global Sightholder Sales recalled the market situation during the past 2 years, which has led to a lower level of demand for polished diamonds and softening of polished prices. He also said that India provides the heartbeat of the modern diamond world and its ability to maintain consumer confidence, innovate with technology and grow diamond value will hold it in good stead. Vipul Shah, GJEPC, commented, “The Indian G&J has seen a slow growth in last few months this year, especially in terms of exports. However, with the Council’s efforts such as IIJS, IIJW and BSMs, we are optimistic that the business sentiments will gradually pick up towards the festive season and the outlook will be positive for the international and domestic retailers.” He also took the opportunity of Mrs. Teaotia’s presence to put forth some demands to the Government of India. While thanking the government for its speedy action regarding Special Notified Zone (SNZ), he urged the government for a 2% interest subvention, ECGC policy for the whole turnover against ECIB covers taken by banks, separate IT HS Code at the 8 digit level for Synthetic diamonds and implement the presumptive taxation regime in diamonds; and many other industry related issues.
The recent drop in gold prices inspired strong traffic with buyers from all over India converging to the Show, to take advantage of the situation. Besides, the local Indian jewelers had apparently waited for the India International Jewellery Show to make their purchases, as they expect good sales during the upcoming Diwali festival and wedding season in the country. The price of gold fell 12% in the past two months, sparking renewed consumer interest in gold. According to reports, consumers have already started purchasing gold and diamond-studded jewellery well ahead of the festival season, a sign of good things to come for the retailers during the Diwali sales! Besides, with demand from China and UAE being weak, the industry players are banking on Indian consumers to spur diamond/diamond jewellery demand. Though diamond jewellery section saw slow business at the start of the Show as buyers were attracted towards gold jewellery because of the low prices, from Day 2 onwards the diamond jewellery section also gained momentum and resulted in good business.
According to a diamantaire, gold and diamonds go together. “Consumers are buying gold and studded jewellery as the price of yellow metal is on the downward side. We are hopeful that the festival season will spark renewed consumer demand, especially during the Diwali festival," he said. India's annual diamond jewellery demand is pegged at more than US $8 billion. Dinesh Navadia, President, Surat Diamond Association said, "After more than six months of lull, there is some movement in the diamond market in Surat. Traders have started doing deals with the buyers and this is a positive sign indicating good days are back."
Business during all the days at IIJS was quite brisk with the huge crowd bringing back the lost confidence and smile back on the industry players’ faces. Most of the exhibitors expressing satisfaction at the good response they received; hoping that the enquiries would translate into long term business for themselves. Many players also asserted that the market was good and that it will get better in the coming months. The price of gold having gone down, people were in a mood to make purchases as they have been waiting to buy at the IIJS, which explained the huge volume of business that was conducted during the Show. It is also reported that demand had picked up, particularly in two- and three-tier towns and rural areas, which again resulted in buyers booking lightweight jewellery. Kolkata jewellery and Antique jewellery exhibitors too did good business, as demand for this jewellery were considerably high. All gold jewellery especially light weight gold jewellery was a sell out; and while small and budgeted diamond jewellery moved very fast, even the large high-end jewellery pieces of high carats and rings of up to 3 carats were in high demand.
In a first, even international buyers had shown interest in gold jewellery this year as those exhibitors, who have been traditionally dealing with heavier and more ornate jewellery, showcased a great deal of lightweight jewellery too. Incidentally, the market had shifted to lightweight jewellery when prices were high but they will always be popular. Another interesting change is that some primarily large gold manufacturers have diversified into the manufacturing of diamond jewellery in recent years, an indication that diamond studded jewellery has made inroads into solely gold jewellery markets. And with diamond jewellery having found its mark with the Indian consumers, jewelers of gold jewellery want to be known as sellers of diamond jewellers as well. Many new diamond jewelers report that their diamond jewellery business contributes up to 30% of their total business, which makes good business sense to them to deal in diamond jewellery.
Though unexpectedly, a positive mood prevailed at the IIJS. And if crowded aisles and footfalls are benchmarks for a successful show, IIJS 2015 was definitely one. Even in case of the international delegation, the response was very positive. The delegations like 125 from Nepal delegation, 150 from UAE delegation and 80 from China delegation added a sense of an active global market.
And, if gold jewellery section continued to outstrip other segments, it is always been so; but maybe a little more this time due to fall in gold prices. Regarding with loose diamond sales being largely flat over the course of the show; and had fewer buyers visiting them or there are no crowd at their booths, it is because IIJS is primarily a jewellery show; and secondly, polished buyers are normally directed to the company offices for a better business atmosphere than a Show to conclude deals. And on the whole, a high demand for jewellery eventually translates into demand for diamonds as well; and would provide a fillip to the entire gem and jewellery industry.
However, many polished diamond exhibitors reported to have received many inquiries for polished in different sizes, and believe that they will translate into actual orders. They are of the opinion that market will open up in the next few months, with the oncoming festival and wedding season. Some claimed that business was a bit down on previous years; volume was reduced, but people were still buying loose diamonds. In terms of polished stones demand, there is a pattern to followed every year… the north of India were more attracted by IJK colors and VS clarity, whereas buyers from the south bought more in EF colors and VVS clarity. This has been the norm, but slowly the younger generation in South India are becoming much more adventurous and are opting for all colour, quality, shape of diamonds in their jewellery… a welcome change! Another polished diamonds exhibitor said he had good demand from customers from across India for 30 pointers and above in both VVS and VS. Generally, white melee did well and larger sizes are sold fairly well but from particular customers looking for specific qualities and sizes. Offering Tenders was a new trend during the Show. One diamond company, which launched tenders, has listed 200 stones in rounds, fancy shapes and fancy colours, mostly from 1.5 ct up, and got a good response, while another launched a tender for polished goods had a wide assortment of shapes in 2 cts up with a few large stones in the 8-11 ct range as well.
Over the past years, India has emerged as a jewellery manufacturing centre that is known for a technologically-forward, design-led product. Companies which offer differentiated and innovative jewellery prevail at all times, whether the market goes through challenging times or not. And demand for jewellery is an eternal phenomenon, as people will always want jewellery, irrespective of the market conditions… more so in India!
The 6th India International Jewellery Week (IIJW) opened at the Grand Hyatt in Mumbai on 3rd Aug 2015 prior to IIJS 2015, with the usual glamour the event is associated with over the years. The four- day event saw jewellery connoisseurs in the country enjoy a preview of some of the finest designer collections created by the Indian jewellery sector. The ‘pieces’ were displayed at the IIJS show for the visitors to enjoy. Mrs. Amruta Fadnavis, wife of Devendra Fadnavis, Hon’ble CM of Maharashtra who was the Chief Guest said that the fact that Indian jewellery adorned women across the globe is a tribute to the skills of the manufacturers.
All in all, IIJS 2015 wound up on a grand scale on a grand note, with the show witnessing 25-30 per cent increase in visitors traffic as well as business, compared to last year. The 5-day show had over 35,000 visitors and more than 2500 international visitors. It is claimed that IIJS-2015 was one of the best editions in recent times. Not only was the visitor turnout above expectations, goods across the categories found good demand - a turn of events that brought good cheer to the industry players.
IIJS Convener Nirav Bhansali reportedly termed the show a “resounding success”, saying that this was not only in terms of the number of visitors but also in terms of business. “We had over 35,000 visitors at the show this year, which included nearly all the large retail chains and independents. Many gold jewellers said that stocks were actually sold out and diamond jewellers were all satisfied.” Confident that the Indian market is set for a good performance during the forthcoming wedding and festival season, Bhansali expressed the hope that IIJS would be a turning point for the industry.
As the curtain came down on IIJS 2015, the Indian gems and jewellery industry seemed more in control, as the good response at IIJS 2015 provided a boost to business confidence. Industry players seemed to heave a sigh of relief as they went back to their business, leaving the uncertainties of the past few months behind; and looking forward for better times in the coming days.
Aruna Gaitonde, Editor-in-Chief of the Asian Bureau, Rough&Polished
