Jewellery exports are likely to be hit and decline by up to 20 per cent in FY14, due to limited availability of gold inventory in the domestic market following the government's steps to curb demand, according to export promotion body GJEPC.
"It is difficult to get stocks for manufacturing jewellery and if the current situation prevails, it is going to hurt the exports by 15-20 per cent this year," Gems and Jewellery Export Promotion Council (GJEPC) Chairman Vipul Shah said.
Even as the US market is picking up, the rise in input costs as well as the interest rates will make it difficult for exporters to ship their products at competitive rates, he said adding this may result in hitting their margins.
To discuss this situation, GJEPC is meeting the Commerce Ministry officials on Monday, he said.
India exported USD 39 billion worth various precious gems and jewellery in the 2012-13 fiscal, according to GJEPC data.
Meanwhile, the All India Gems & Jewellery Trade Federation (GJF) has taken steps to help curb gold imports by issuing a circular to its members to stop selling bars and coins.
"We have requested our members and affiliated members to help the government to reduce gold import by not selling bars and coins. We have got positive response from our members and the result of this will be seen in the July imports," GJF former Chairman Bacchraj Bamalwa said.
About 150 tonnes gold is used for coins and bars by jewellers, he said.
In July, the imports is likely to decline by 30-40 per cent compared to July, 2012, when the imports stood at around 60 tonnes, he said.
Bamalwa said if the government does not take any steps and the current situation continues, it will have a heavy impact on the industry.
"It is very difficult to restock as it is difficult to get gold in the market. The premium has also gone up to USD 20 in the open market from USD 1," he said.
Source:-www.indianexpress.com
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