Sakshi Sharma February 07, 2023
It is said that the most glamorous and traditional industry is our jewellery and gems industry. Globally millions of people are employed in this industry. With human evolution, several activities are aligned in this industry which include, polishing, mining, cutting, fabrication and retailing.
In the world market of jewellery and gems, India has a very important role. It is said that, after the US market, the jewellery market of India is the biggest in terms of size, and after the US comes the jewellery market of China, Japan and Italy. In the world, the biggest consumer of gold is India. Many famous designers from India have made recognition in the world and are also known for their unique design development. In recent times, consumers are also attracted to online Indian artificial jewellery in addition to gold jewellery. India has an ancient tradition of making jewellery every village in India has a goldsmith family.
Problems of the gems and jewellery industry
Raw materials are very important for the Indian gems and jewellery industry. About 90% of the raw materials are imported into India but still, the supply of raw materials is very limited. After importing the raw materials, they were processed, polished, and manufactured in such a way as to make them a saleable item to be able to sell item in the international market. Almost 50% of the raw material of rough diamonds are imported. Then these raw diamonds are polished, cut and then exported. India mainly imported rough diamonds from, the UK, Belgium, Israel, etc., similarly India imported white gold from South Africa, Switzerland, Australia, the UAE etc. for India Europe is the important and biggest importer of different raw materials, for the gems and jewellery industry of India. This sector of India is hugely dependent upon imported raw materials, and, naturally, more export means more imports. Excess import of raw materials can cause worry for India when export make fewer earnings in the foreign exchange.
Threat of competition
India is presently dominating the cut and polished world diamond market, and china is emerging as the main rival, if not now then shortly. Similarly, like India, china has the qualities like economically cheap labour, infrastructure, and accessible government. India also competes with China in terms of technology. Africa is becoming a threat to India in the production of diamonds. Such development is affecting the Indian gems and jewellery industry.
Indian gems and jewellery industry required a huge amount of different product which consists of gold jewellery, polished diamond, Silver Jewellery, pearls, coloured gemstone for making Kundan Jewellery, rough diamonds, Traditional artificial jewellery, and synthetic stones. One of the unfair that prevails in the industry is that too much importance is given to diamonds. About 85% of total export is taken by diamonds among the different gems and jewellery. The export potential of other gems and jewellery didn’t give so much attention.
Changes in fashion
Changes very require in the fashion of gems and jewellery in the global market. Not enough development is made in the design of the jewellery, innovation is needed in the gems and jewellery industry to attract more foreign buyers. The jewellery manufacturer is sticking to some specific old designs of jewellery, now it’s time to change the design of jewellery according to the demand and changes of fashion. The broker gets the stock from the seller to sell them. This situation made the seller not sell an item below the product cost. Gems and jewellery have this major problem.
This is the main problem of the industry. This sector needs a lot of finance for investing in their production because the jewellery and gems industry deals mostly with expensive gemstones. The exporter of gems and the jewellery industry face lots of problems in sourcing their following capital needs:
- Banks charged a high-interest rate on their export credit.
- For sourcing rough diamonds credit for lack of dollars is needed.
- For extending the limits of credits minimal sanction is given to the exporter of gems and jewellery industry.
- The credit rating agency does partiality when rating gems and jewellery firms.
- Above all, there are so many formalities of the financial organization that it takes o much time.
The future expectation of the industry
In the Indian economy, the industry of gems and jewellery plays a very important role, and this industry made a huge number of exports from India. Indian gems and jewellery industry have witnessed a growth of 8.26% in their overall export for the year 2022. It can be said that the Indian gems and jewellery industry is 100% export-oriented industry.
Strategies to tackle the problem
Some of the following recommendations have suggested for tackling the various problem which is faced by the gems and jewellery sector of India:
- There should be good quantity and good quality of raw materials should be available at a reasonable price. It is very important for trade.
- The manufacturer and exporters of the gems and jewellery industry need changes according to time so planning of product and its development is very important.
- The manufacturer should give importance to their “comparative advantage” that is created by the structure of the market, diversification of products, technology and other things.
- It should be the primary aim of the government they establish new and better jewellery institutes all over the country, especially in India. Etc.
Logically it can be said that the Indian gems and jewellery industry have a promising future nowadays Customized Jewellery in India has huge demand all over the world. For any kind of Indian jewellery shop with Ciero Jewels.
What are the problems faced by the jewellery industry?
There are many challenges which are faced by the Indian jewellery industry facing today.
What are the threats to the gems and jewellery industry?
The gems and jewellery industry are facing lots of threats, like, import dependency, fashion changes, growth imbalance of products, the problem regarding labour etc.
What is the future of the Indian jewellery industry?
the behaviour of the consumers has created a new channel and favourable market conditions for the industry.