Raj Mendiratta, 53, is busy shopping for gold for her daughter's marriage in January. But there is a catch. With the yellow metal's prices up and limited designs on sale, she has decided to recycle her old ornaments and give it a new designer spin to meet her demand.
Customers like her are blazing a new trail in a year in which the government jammed the brakes on gold imports to prop up the rupee. In the process, key supplies for jewellery seekers are down, and naturally, so is new stuff on offer.
"There is limited variety in terms of designs and pieces. I have searched many branded and local outlets but jewellers claim they are running short of inventory," she said.
Faced with high premiums to secure scarce supplies of gold, more and more people are having their old heirlooms melted down to be reused as gifts. Jewellery firms across the country, finding the going equally tough, are trying to replace the ornaments made of the traditional precious metal with other gems and metals.
In fact, an estimated 20,000 tonnes of gold stored with Indian households is likely to get recycled to meet the demand during the current wedding season, industry executives say.
According to estimates by the All India Gems and Jewellery Trade Federation, only about 25 tonnes of new stock of the yellow metal are now being used every month to craft jewels against an average of 75 tonnes about two years ago. Recycling of gold has also increased by 20%, jewellers say.
"Even though the wedding season is on, demand is tepid and there is general reluctance to buy gold as prices have increased manifold," said Ashok Minawala, board member at the federation, adding the government's policies have made it all the more difficult for the industry.
The government has imposed supply restrictions on gold, the biggest non-essential import item, by linking domestic use of imported gold to exports in order to curb a record current account deficit or CAD (the annual gap between dollar inflows and outflows). It has also hiked the import duty on the metal to a record 10%.
"This wedding season has remained challenging for us because of minimal availability of inventory. We are trying to source gold from various importing agencies to meet the dull demand," Sandeep Kulhalli, vice-president, retail and marketing, Titan Company Ltd, told HT.
"No inventory is available because of which we are forced to focus on diamond-based jewellery," said Mehul choksi, managing director, Gitanjali Gems.
Industry insiders said many jewellers in the unorganised sector are also resorting to sourcing of the precious metal through dubious "parallel" channels - often a euphemism for smuggled goods.
"Customers are not bothered about the economy and import restrictions. All they understand is the importance of the occasion and the importance of gold. This season due to a lack of inventory not many options are available. Seventy per cent of the total sales in the last month was through recycling of gold," said Bhim Singh Taneja, manager at Jhaveri Jewellers, a small jewellery store in Old Delhi's Chawri Bazar.
However, with CAD dropping to a comfortable 1.2% of GDP in July-September, the government and RBI may look at ways to ease the tightening measures. "Though there is no immediate plan to alter the existing policy on imports, going ahead, we would need to look into the issue," a government official said.
Finance minister P Chidambaram has also urged Indians to moderate their demand for gold, though had he ruled out a ban on the import of the precious metal.
For the moment, if you have your daughter's wedding coming up this season, your option may be to dust up - and redesign - your own family jewels.