Overseas orders for Indian jewelry have declined by 25% for the Christmas season because of a global economic slowdown, according to the Gems and Jewellery Exports Promotion Council (GJEPC). Indian jewelry manufacturers were hoping for strong Christmas sales on reports of a revival of economic sentiment in the US, to which India contributes nearly 40%. "Jewelry export orders are around 75% of the normal. The US has shown little sign of recovery and orders from the rest of the world are weak," said Praveen Shankar Pandya, chairman of GJEPC. Gold and rough diamond prices have declined 5-10% in the past month, while manufacturers and dealers have also cut prices of polished diamonds, but this has not led to jewelry demand.
The GJEPC has urged the government to help the jewellery industry with an interest subvention scheme. Indian jewelers need to offload three months of extra inventory in the global markets in two months. "This inventory carries costs ... Indian exporters will be unable to compete against players in Belgium and China," Pandya said. Making matters worse, "The domestic market has also seen a sharp decline in jewelry consumption," said Shreyas Doshi, chairman of Shrenuj & Company Ltd.