MUMBAI, May 4, 2009 (JO) - Vasant Mehta, who was elected late in 2008 as Chairman of the Gem and Jewellery Export Promotion Council (GJEPC), tells Jewellery Outlook in an interview he sees markets growing in the Middle East, China and Eastern Europe.
Jewellery Outlook: What are the main reasons for the steep decline in India's gem and jewellery exports in the past several months?
Vasant Mehta: The recession has affected the gem and jewellery industry along with many other industries. The effect on this luxury product impacts more, as it is the last item on the consumer's shopping list.
Jewellery Outlook: When do you foresee a recovery in the market? Have you seen some signs of improvement?
Vasant Mehta: We are presently seeing improvement as the demand from overseas and domestic markets has increased compared to previous months. Production has also reduced and accordingly the markets will recover faster than expected. However, total recovery can only be expected at the end of the recessionary period.
Jewellery Outlook: What are India's main markets for gem and jewellery exports? What is the worst performing market, and which markets have shown resilience?
Vasant Mehta: The United States has always been the largest consumer market for the gem and jewellery industry. However, presently the Middle Eastern market has grown considerably. Apart from these, Hong Kong is also showing steady growth. There has been a considerable fall in the Japanese market, whereas in China and CIS countries demand is growing and business there is improving.
ewellery Outlook: How have India's gem and jewellery exports fared in the U.S. market, perhaps the worst hit by the global credit crisis. When do you foresee an improvement in India's exports to the U.S.?
Vasant Mehta: What we see in the U.S. market is a fall in demand for diamonds and diamond jewellery, compared with electronic and other luxury products in the last few years. The recession and financial crisis have further pushed demand down in the entire luxury segment. However, diamonds will be in demand as long as people get married, and we see good growth in exports to the United States in the second half of this year.
Jewellery Outlook: What has been the impact of slowing exports on the domestic Indian gem and jewellery market? Have there been significant job losses, company closures and shrinking margins in the industry?
Vasant Mehta: The domestic consumer market is much better and is in fact growing. While in the manufacturing sector of the export market there have been job losses and some factory closures, exports are showing signs of improvement.
Jewellery Outlook: Has the Gem and Jewellery Export Promotion Council taken special
measures to tackle the crisis and increase exports of gems and jewellery to key markets?
Vasant Mehta: Our promotional and marketing efforts in finding new markets have been very successful and we are focusing more on them. This year we will be holding buyer-seller meets with industry participants from China and Europe and exploring the Australian and Vietnamese markets.
Jewellery Outlook: What response have you seen to your India International Jewellery show (IIJS, 6-10 Aug, 2009) this year? Do you think the number of exhibitors and visitors is going to be lower this year than in previous years?
Vasant Mehta: Our show has always been very successful every year and this year too there has been increased demand from exhibitors. The IIJS is now a "must visit" show for domestic as well as international visitors. We will be creating more booths this year as there is a long waiting list of exhibitors who want to participate.
Jewellery Outlook: Which countries have shown most interest in this year's jewellery show? Are you planning special measures and promotional activities to attract overseas visitors and exhibitors to the event?
Vasant Mehta: We get visitors and delegations from over 15 countries. We have created international pavilions for overseas exhibitors from Israel, Belgium, Italy, Turkey and several European and Middle Eastern countries.
Jewellery Outlook: How do you see prices of rough diamonds by the end of 2009? Do you think prices will remain depressed due to falling global demand for luxury items amidst the financial crisis?
Vasant Mehta: The prices of rough diamonds will go up in the second half of 2009 and this trend will continue. The supply is going to reduce due to closure of certain mines where the production is going down. Diamond demand will outpace supply and will result in increased prices.
Jewellery Outlook: How do you see global gold prices and demand for the metal in India in the coming months?
Vasant Mehta: India has always been a large market for gold and demand for gold grows year after year. The price of gold however depends on many other factors but I see prices stabilizing at current levels this year.
Source: Jewellery Outlook
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