Polished trading in the Indian diamond market during the month of May was sufficiently brisk, while rough trading was just normal paced. Production in the cutting centres was in full swing throughout the month, despite it being summer holiday time. Most factories and SMEs remained in operation throughout the month, due to good demand presumably. Overseas demand was good, especially from the US and Middle East including demand from the Indian domestic market.
The Indian diamond industry is slowly recovering from the past rather dismal export performance, thanks to the economic revival in consuming countries. The country’s cut & polished diamond exports for the month of Apl. 2016 amounted to $1.78 bn as against $1.64 bn in Apl. ’15, a rise of 8.85 percent, according to provisional data announced by the Gem & Jewellery Export promotion Council (GJEPC) of India. The Indian diamond industry, which had been severely hit by the global slowdown for many months, is finally improving. Rough diamond imports recorded an increase of 37.22 percent to $ 1.88 bn for Apl ’16 as against $ 1.37 bn in Apl ’15. Rough exports decreased by 23 percent, registering $ 86.14 mn for Apl ‘16 as against $ 111.83 mn for Apl ‘15. Cut & polished diamonds imports declined by 8.63 percent recording about $ 223.05 mn as against $ 244.13 mn in Apl ’15. This augurs well for the local cutting & polishing centres which are left holding inventories, which is proving costly, depriving them of the already wafer-thin profits. The Indian government is succeeding gradually in its attempt to curb polished diamond imports, in support of the diamond cutting & polishing centres in the country.
The domestic gem & jewellery sector picked up momemtum from the recent ‘strike’ by the jewelers. But, demand on the auspicious day of 'Akshaya Tritiya' remained quiet due to high prices of gold. However, despite the low sales volume jewellers across the country feels that Akshaya Tritiya 2016 has provided the much needed boost to the sector. Jewellers in Mumbai and Pune did good sales, especially in light-weight jewellery and gold bullion, despite increased gold prices. Jewellers in South India as well as the northern part of the country did good business in jewellery compared to bullion. That people were making purchases even amid high gold prices, shows that the sentiment attached to the yellow metal is still strong and the nature of buying gold will not change in India.
The diamond market in Mumbai was abuzz when news, that four polished diamond traders operating from Bharat Diamond Bourse (BDB) at Bandra Kurla Complex (BKC), Mumbai had defaulted on payments to the tune of over $22.55 mn, made the rounds. According to media reports, dozens of traders and small manufacturers in Surat were left in the lurch. The reason was due to a Chinese firm that had defaulted on the payment to the Mumbai-based parties.
Following a series of defaults that rocked the industry since January 2016, involving amount to the tune of over $60mn by parties in Mumbai and Surat, Jewellery Export Promotion Council (GJEPC) regional chairman Dinesh Navadiya, said "We have urged diamond traders and manufacturers to implement KYC norms when they strike a deal in precious diamonds with anyone.”
The month of April also brought some good news for the Indian industry.The World Federation of Diamond Bourses (WFDB) added the Gems and Jewellery Export Promotion Council (GJEPC) as a member among its 31-member bourses across the globe. The decision was taken at the ongoing 37th World Diamond Congress at Dubai recently. The next Presidents Meeting in 2017 will be hosted by the Bharat Diamond Bourse.
That’s not all, the European Union and India, which participated in the KP Intersessional, made a co-ordinated proposal on 26th May, under which EU will assume responsibility as KP Vice-Chair in 2017 and as KP Chair in 2018; while India will become KP Vice-Chair in 2018 and assume the position of KP Chair in 2019.
While numerous initiatives are constantly being chalked out here for the industry, Gems & Jewellery Skill Council of India launched the RPL Program (Recognition of Prior Learning) as the first step to uplift the Karigars (artisans) in the Indian Gems & Jewellery Sector along with an awareness Ad Film during a conference at Indian Merchants Chamber in Mumbai.
Also, the Indian Institute of Gems and Jewellery (IIGJ), a GJEPC initiative, will now offer a 3 year Graduate Program in Jewellery Design & Management Techniques in collaboration with Welingkar Institute of Management.
The GJEPC’s efforts to further the industry is an ongoing process, Recently, the committee members met with a delegation from the Consulate General of Belgium and Brussels Airlines today to discuss the proposal of Brussels Airlines to start direct flights from Mumbai to Brussels.
In another meeting, representatives of GJEPC and the Bharat Diamond Bourse (BDB) met with a US delegation in Mumbai to discuss compliance issues.
Some events during the month that made the Indian industry proud ----Indian company Kiran Gems, the world’s largest diamond manufacturer, was a warded the FIEO (Federation of Indian Export Organisations) "Niryat Shree Gold Trophy" in the Gems and Jewellery-Non-MSME category. The event was held on the evening 4th of May 2016, at Vigyan Bhavan- Delhi, India. In addition, three Indian jewellery companies – Titan, Gitanjali Gems and PC Jewellers – have been ranked among the 100 largest luxury goods companies globally by Deloitte Touche Tohmatsu Limited in its latest Global Powers of Luxury Goods 2016. The listing is based on publicly available data for consolidated sales of luxury goods in the 12 month period ending 30 June 2015.
The Indian retail chain, Kalyan Jewellers is eyeing a turnover of around $1954 mn this fiscal (FY-17) banking primarily on its $135 mn retail expansion plans through 20 stores in India and in the United Arab Emirates (UAE).
The online space is becoming crowded by the day, with new start-ups as well as established companies coming together for mutual benefit. Titan, the Indian watch and jewellery maker, entered the online jewellery space last week by acquiring a majority stake in an online company CaratLane for an undisclosed sum. This is about to set an interesting precedence for ecommerce in the country.
Aruna Gaitonde, Editor-in-Chief of Asian Bureau, Rough&Polished
