As the festive season kicks off, you may have to settle for ornaments with lower gold content, or for platinum or diamond jewellery.
The jewellery industry is finding the going tough due to the stiff import curbs on gold, and there is a shortage of the yellow metal at a time when demand is expected to shoot up, which industry insiders foresee as spawning a black market for the metal.
Indian jewellers consume about 600 million tonnes of gold annually, and demand escalates in the second half of the financial year.
Jewellery majors such as Tanishq, Gitanjali, PC Jewelers, TBZ and others are working to bring in alternatives that could help tide over the gold shortage in the coming festive season.
“We are trying to manage by working closely with some companies and refineries that get gold as byproduct of their core business,” CK Venkataraman, CEO (jewellery), Titan, told HT. “For instance, copper refineries get gold as a byproduct. It is not abundant, but still, it can help us overcome the shortfall.”
“Due to limited supply and growing demand, we plan to introduce lighter weight gold jewellery mostly made of 14-carat gold,” said Mehul Choski, MD, Gitanjali Jewels. “We could look at replacing gold jewellery with alternative metals and diamonds and other gems.”
Imports of gold have been practically halted in the last couple of months to bring down the current account deficit — the difference in infow and outflow of dollars. The government has said the CAD would be contained at $70 billion this fiscal.
Import duty on gold has been hiked three times since January to a record 10%.
The Gems and Jewellery Federation said the government has made it difficult for the industry.
“The problem cannot be addressed by curbing gold imports suddenly. Indians have been traditionally a gold and jewellery crazy society, it cannot be altered all of a sudden,” said Ashok Minawala GJF board member.