According to the Indian Brand Equity Foundation, The Gems and Jewellery sector plays a significant role in the Indian economy, contributing around 6-7% of the country’s GDP. One of the fastest growing industries, it is extremely export-oriented and labor intensive. India is deemed to be the hub of the global jewellery market because of its low costs and availability of high-skilled labor. India is one of the world’s largest cutting and polishing center for diamonds, with the cutting and polishing industry being well supported by government policies. Moreover, India exports 95 per cent of the world’s diamonds, as per statistics from the Gems and Jewellery Export Promotion Council (GJEPC).
EXPECTED GROWTH OF JEWELRY MARKET
The gems and jewellery market in India is home to more than 500,000 players, with the majority of small players. According to a report by Research and Markets, the jewellery market in India is expected to grow at a Compound Annual Growth Rate (CAGR) of 15.95 per cent over the period 2014-2019.
CHANGES IN CUSTOMERS PREFERENCES
The Gems and Jewellery sector is witnessing changes in consumer preferences due to adoption of western lifestyle. Consumers are demanding new designs and varieties in jewellery, and branded jewelers are able to fulfill their changing demands better than the local unorganized players. Moreover, increase in per capita income has led to an increase in sales of jewellery, as jewellery is a status symbol in India.
EXPERIENCE OF TARUN JAIN – THE MARKET LEADER
Taking in perspective of the market leader Tarun Jain of Tarun Jain Fine Jewellery, the sector can be seen as a happy mood sector. In his three week-long recent visit to the “Grizzle” Emerald mines in Zambia in the month of June 2016, he spent his days carefully watching the extraction of the beautiful emerald and it’s coming into shape. He was specially invited by Mr. Abdulla (owner of Emerald mines), who met him in a dinner hosted by all emerald importers in Jaipur a year back.
“The sector is slow to pick up and faces a lean period from May to 15 September every year. It is only that a sense of prosperity rushes into the human sentiments after that, and people can be seen entering more into the jewellery shops.” – said Tarun Jain.
In the coming years, the growth in Gems and Jewellery sector would be largely contributed by the development of large retailers/brands. Established brands are guiding the organised market and are opening opportunities to grow. Increasing penetration of organised players provides variety in terms of products and designs. Also, the relaxation of restrictions of gold import is likely to provide a fillip to the industry. The improvement in availability along with the reintroduction of low cost gold metal loans and likely stabilisation of gold prices at lower levels is expected to drive volume growth for jewellers over short to medium term. The demand for jewellery is expected to be significantly supported by the recent positive developments in the industry. Read more articles on Entrepreneurs.