Gems and Jewellery Industry in India
The Gems and jewellery sector has a huge market in India and abroad alike. This market encompasses various kinds of jewels including gold, coloured gemstones, costume jewelleries, platinum and diamonds. The sector is expected to register a compound annual growth rate (CAGR) of 13 per cent during 2011-2013, according to a report “Indian Gems and Jewellery Market Forecast to 2013,” by research firm RNCOS.
The RNCOS report came out in the year 2010, and was indirectly supported by the findings of a leading industry body and published in the same year. The growth rate of the gems and jewellery industry in India stands at 15 per cent, while the domestic jewellery market was worth US$ 16-18 billion. As far as exports are concerned, this sector constitutes more than 12 per cent of the total exported products. The journal estimated that by year 2015 the gems and jewellery sector will help India earn about US$ 25-35 billion in form of export revenue. A steady sale of jewelries, especially of gold, has helped the gems and jewellery industry in India flourish at this rapid rate. Moreover, people are also investing their money in gold as a future recourse to counter tough times. In addition, India has evolved as a great place for diamond processing, according to the industry body.
Gems and Jewellery Industry in India: Industry Structure
Gold is the principal raw material for making jewellery in India. In 2007 gold had a market share of US$ 12.24 billion (Rs 550 crores), while diamond had a market share of US$ 2.56 billion (Rs 115 crores). Eighty per cent of the gems and jewellery industry in India is dominated by gold and the rest is controlled by diamond and gemstone industry. This trade in India is mainly fragmented as 96 percent of total business comes from unorganised sector.
Gems and Jewellery Industry in India: Gold
The importance of gold in the Indian gems and jewellery sector is significant. In the year 2008 India had a gold consumption rate of 24 per cent, according to the report “Indian Gems and Jewellery Market Forecast to 2013,” by research firm RNCOS.
This made the country become a leader in the table of most gold consuming nations with the consumption amounting to about 16,000 tonnes. The other key markets include Japan, China, Turkey, Italy, USA and UK. It is expected that the Gems and Jewellery industry would enjoy agrowth of about 8.5 per cent in the period upto 2015. It is also estimated that about 600 tonnes of gold is used to make jewellery.
Gems and Jewellery Industry in India: Diamond
Currently India is the major polishing and cutting hub for diamonds. India is also the third largest consumer of polished diamonds. The surge of urbanization and rapidly growing middle class in India has led Indian consumerism to new heights, particularly in the diamond jewellery sector. Every 11 out of 12 diamonds sold around the world are processed in India regardless of the place they are mined.