Wednesday, April 16, 2008

Diamonds Help Gem & Jewellery Exports Clock 22% Gain

Mumbai: Gem and jewellery exports increased 22 per cent to $21 billion ($17 billion) during the 2007-08 fiscal. In the rupee terms, they increased 9.02 per cent to Rs 84,200 crore (Rs 77,100 crore ).

Sanjay Kothari, Chairman, Gem and Jewellery Export Promotion Council, said: “The industry managed a steady growth due to increase in diamond trading activities as manufacturing has shown a decline. The volatility in gold prices and international economic scenario has slowed down demand for gold jewellery world wide.”

GSP withdrawal

Gold jewellery exports declined 3.64 per cent to Rs 22,625 crore; however, in dollar terms it was up 8.07 per cent to $5.62 billion.

The withdrawal of GSP (general system of preference) benefits affected gold jewellery exports to the US.

Exports of cut and polished diamonds, which jumped 30 per cent to $14.2 billion, accounted for nearly 68 per cent of total export basket.

The industry has managed to exceed the target of $18 billion set by the Government despite an economic slowdown in the US which accounts for 50 per cent of world jewellery market.

China through Hong Kong has emerged as the largest importer of cut and polished diamonds from India with a share of 35 per cent of total exports, while the US and United Arab Emirates accounted for 24 per cent and 13 per cent, respectively. The share of Hong Kong and US in India’s overall gem and jewellery exports was at 26 per cent each, while United Arab Emirates accounted for 21 per cent.

Recession impact

Predicting that the US recession will have a major impact on exports next fiscal, Kothari, said over 1.50 lakh people have lost their jobs as many small jewellery makers have shut shop in Mumbai due to fall in demand in the international markets, constrains in raw material procurement, volatile gold prices and rupee appreciation.

“We are going to have a difficult year, even if efforts are made to target other markets, it’s not going to be that easy. It is going to take a huge effort and time for other countries to catch up,” he added

Total imports of gem and jewellery provisionally rose to $18.5 billion in the fiscal, growing 32.5 per cent from last year.

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