AN INITIATING COVERAGE REPORT ON:

GEMS & JEWELLERY INDUSTRY

Written by- Khushbu Wankhede

OVERVIEW
In financial year 2021, Indian gems and jewellery industry’s market size stood at US$ 78.50
billion. In 2022, India ranked 6th in export of gems & jewellery to world, with 4.70% of the
total share. As of February 2021, the industry’s trade contributed approximately 7.5% to
India’s GDP and 14% to India’s total merchandise exports.
As from employment point of view, the industry is likely to employ approx. 8.23 million
people by 2022, from 5 million in 2020.
India's total exports of gems and jewellery reached US$ 3.28 billion in January 2022,
increasing by 23.66% year over year. India's exports of gems and jewellery are predicted to
increase by 6.5% over pre-covid levels to reach US$ 40 billion in 2021–22. The Indian
government wants to increase its exports of jewellery from US$35 billion in 2020 to US$70
billion over the next five years (until 2025).

TOP 10 GLOBAL GEMS AND JEWELLERY COMPANY

As per statistics available till May 2021, top 10 global gems and jewellery companies
according to revenue of 2020 are:
1. LVMH, Paris, France
2. Rajesh Exports, Bangalore, India
3. Chanel, London, UK
4. Chow Tai Fook, Hong Kong
5. Cartier, Paris, France
6. Signet, Ohio, USA
7. Tiffany & Co., New York, USA
8. Pandora Jewellery, Copenhagen, Denmark
9. Harry Winston, New York, USA
10. Chopard, Geneva, Switzerland
 Top 10 Global Gems & Jewelley Company
LVMH 54
Rajesh Exports 27
Chanel 13.7
Chow Tai Fook 7.3
Cartier 6.2
Signet 6.1
Tiffany & Co. 4.4
Pandora Jewellery 3
Harry Winston 0.274
Chopard 0.175

0 10 20 30 40 50 60

2020 Annual Production (in $ Billions)

TOP 10 GEMS & JEWELLERY COMPANY IN INDIA

According to market capitalisation till 29th July 2021, top 10 gems and jewellery companies
in India are:
1. Titan Company
2. Rajesh Exports
3. Kalyan Jewellers
4. Vaibhav Global
5. PC Jewellers
6. Goldiam Inter
7. Thangamayil
8. Asian Star
9. Renaissance
10. Tribhovandas
 Top 10 Indian Gems & Jewellery company
Titan Company 2,08,900.52
Rajesh Exports 17,553.20
Kalyan Jeweller 6,690.19
Vaibhav Global 4,904.61
PC Jeweller 2,178.09
Goldiam Inter 1,634.62
Thangamayil 1,443.16
Asian Star 1,280.54
Renaissance 1,074.71
Tribhovandas 468.78

- 50,000.00 1,00,000.00 1,50,000.00 2,00,000.00 2,50,000.00

Market Cap. (in INR Cr.)

HISTORY OF GEMS & JEWELLERY INDUSTRY

The development of the jewellery business has been aided by the long history and cultural
legacy of gems and jewellery, as well as a persistent fascination to gold. India has well-
established skills in producing hand- and machine-made jewellery in both traditional and
contemporary styles.
India is one of the world's jewellery marketplaces that is expanding the fastest, according to
the Export and Import Bank of India. Exports of jewellery to important markets like the
United States and Europe as well as domestic demand are probably the main factors driving
this industry's expansion. The introduction of hallmarking and certifications, the availability
of skilled artisans with expertise in jewellery making, designing, diamond cutting, and
processing at competitive wages, as well as conscious marketing efforts by jewellers, are
some of the additional factors contributing to the increase in affordability of middle-class
Indian consumers.
Gold Trade and Government Policy since 2000:

Year Policy
2000 14 banks and institutions were involved in the import of gold.
2011 30 banks were authorized to import gold and silver.
2013 Government raised import duty on gold from 2 per cent to 8 per cent
in order to curb imports.
2014 Government further raised the import duly to 10 per cent. The
government also made it mandatory to export 20 per cent of the
imported gold.
 2016 Government levied 1 per cent excise duty on gold jewellery. PAN card
for jewellery purchase of above Rs.2 lakhs in order to curb black
money.
2017 GST on Gold is 3%.

India’s Gold Production since 2002:

Financial Year Production (in 1,000 kgs)

2002 3.8
2003 3.2
2004 3.7
2005 3.1
2006 2.4
2007 3.0
2008 2.7
2009 2.8
2010 2.3
2011 1.7
2012 1.6
2013 1.6
2014 2.0
2015 1.7
2016 1.4
2017 1.5
2018 1.65
2019 1.67
2020 1.74
2021 1.13
2022(estimated fig.) 0.99

Gold prices in India since 2000

Year Price per 10 Grams Year Price per 10 Grams

2000 4,400 2012 31,050
2001 4,300 2013 29,600
2002 4,990 2014 28,006
2003 5,600 2015 26,343
2004 5,850 2016 28,623
2005 7,000 2017 29,667
2006 8,570 2018 31,438
2007 10,800 2019 40,000
2008 12,500 2020 48,651
2009 14,500 2021 50,045
2010 18,500 2022 52,950
2011 26,600
Industry Dynamics
The primary activities of the gem and jewellery sector are the acquisition, treatment,
production, and sale of precious metals and jewels like gold, platinum, silver, and diamond.
More than 500,000 jewellers and gem dealers operate in the highly fragmented industry
nationwide, with the majority being tiny businesses. Even though organised retail only
makes up around 4–6% of the industry overall, India is rapidly recognised as a top
worldwide location for obtaining high-end designer jewellery. International retailers like
Walmart and JC Penney purchase jewellery from India.
Two major components of the gems and jewellery industry are gold and diamond. Over 20%
of the world's gold is consumed by India, which is also the top consumer. About 80% of the
jewellery sold in India is made of gold, with the remainder being manufactured studded
jewellery (including diamond and gemstone studded jewellery). The domestic market
accounts for a sizable share of the consumption of gold jewellery made in India.
Products of Gems & Jewellery Industry:

• Gold Jewellery
• Cut and Polished Diamond
• Silver Jewellery
• Gold medallions and coins
• Rough diamonds
• Coloured Gemstones
• Others (Pearls etc)

Manufacturing Process
The raw materials for this industry in imported from different countries. The import data for
the financial year 2021-22 is shown below:

Import Data of last 2 FY (IN USD Million)

3500
3000
2500
2000
1500
1000
500
0
April May June July Aug Sept Oct Nov Dec Jan Feb March
2021-22 2259.75 1761.49 2269.41 2209.98 1856.83 2321.16 2022.13 1651.73 2793.76 1887.93 2727.92 2886.92
2020-21 9.48 319.59 599.83 581.07 933.35 1963.22 2049.4 1491.63 2186.08 0.98 3.84 0.35

2021-22 2020-21
 Destination Wise Import of 2021-22
(in USD Millions)
5.20%
5.40%

16.10%

48.60%

24.70%

UAE Belgium HongKong Israel South Sfrica

Technology used in manufacturing

The polishing, manufacturing, and jewellery design processes for gems and jewellery have
gradually been replaced by high-tech, quick, and capable machinery and software. The
industry's active participants are constantly searching for more effective methods for their
units. However, due to the small scale and lack of organisation among the bulk of
companies, such tactics are not widely used in the Indian gems and jewellery business.
When cutting and polishing gems, the players occasionally employ the same tools that were
in use 100 or 150 years ago. This industry's main issue now is this traditionalism.
Productivity is low due to the usage of conventional techniques and equipment. The Indian
gem and jewellery industry struggles to raise the considerable amount of funds necessary
for the replacement.
The process of cutting and polishing gems is called gemcutting or lapidary, while a person
who cuts and polishes gems is called a gemcutter or a lapidary (sometimes lapidarist).
Gemstone material that has not been extensively cut and polished is referred to generally
as rough.
Common techniques used in lapidary are:

• SAWING:
In most gem sawing, a thin circular blade usually composed of steel, copper, or a phosphor
bronze alloy impregnated along the outer edge with diamond grit and rotating at several
thousand surface feet per minute literally scratches its way through a gemstone. A liquid
such as oil or water is used to wash away cutting debris and keep the stone and the
sawblade from overheating, which could cause damage to both the stone and the sawblade.
Several sizes of circular rock saws are frequently used by most gemcutters:
• A slab saw, typically 16 to 24 inches in diameter, is used to cut stones of several
inches thickness into relatively thin slabs (often 1/8 to 3/8 inch thick).
• A trim saw, typically 6 to 10 inches in diameter, is used to cut smaller stones into
thin slabs or to cut small sections out of slabs.
• A faceter's trim saw, typically 4 inches in diameter, is used with a very thin blade, to
saw small pieces of expensive rough.
There are also jigsaws that employ either a reciprocating wire or a continuous thin metal
band. These are useful for cutting curved lines that are impossible with circular saws. They
are also useful in minimizing waste on extremely valuable rough material.

• GRINDING:
To shape gemstones into a desirable rough form, or preform, grinding is typically done with
silicon carbide wheels or wheels coated with diamonds. Like while cutting, debris is
removed and overheating is avoided by using a coolant or lubricant (water or oil). Stone is
quickly removed with very coarse diamond or silicon carbide materials like 60 grits, or mesh,
(400-micron particles), or 100 grit, (150-micron particles), while final shaping and sanding
are done with finer abrasives like 600 grit, or 30 microns, or 1200 grit, or 15 microns.

• SANDING:
Although finer abrasives are used, sanding is comparable to grinding. Its function is to erase
significant scratches left by grinding with coarser abrasives. Due to the slower rate of
material removal, the final contouring of the stone before to polishing can be done with
more finesse. To prevent flat patches from forming and to encourage smooth curves,
flexible surfaces like a belt sander are frequently employed on stones with rounded
surfaces.

• LAPPING:
Lapping, which is particularly used to produce flat surfaces on stones, is very similar to
grinding and sanding except that it is carried out on one side of a spinning or vibrating flat
disc known as a lap (as in faceting). Cast iron, steel, or a copper-bronze alloy are frequently
used to make laps, but other materials can also be utilised.
 • POLISHING:
After a gemstone is sawed and ground to the desired shape and sanded to remove rough
marks left by coarser grits, it is usually polished to a mirror-like finish to aid light reflection
from the surface of the stone (or refraction through the stone, in the case of transparent
materials). Very fine grades of diamond (50,000 to 100,000 mesh) can be used to polish a
wide variety of materials, but other polishing agents work well in many instances. Usually,
these polishing agents are metal oxides such as aluminium oxide (alumina), cerium oxide, tin
oxide, chromium oxide, ferric oxide (jeweller’s rouge), or silicon dioxide (Tripoli). Different
stones are often very inconsistent in their ease of polishing, particularly in the case of
faceted stones, so gemcutters are often very inventive in trying new combinations of
polishing agents and polishing surfaces -- often tin, tin-lead, lead, leather, felt, pellon, wood,
or lucite laps for flat surfaces such as facets. Rounded surfaces, such as on cabochons, are
often polished on felt, leather, cork, cloth, or wood. Polishing removes small quantities of
stone and can be used, especially when faceting small stones, to do ultrafine shaping of the
stone.

• DRILLING:
A short revolving rod or tube with a diamond tip, or a slurry of silicon carbide and coolant, is
used to drill through the stone when a gemcutter needs to make a hole in or through a
gemstone (for example, a bead). Although vibrating or ultrasonic drills are also incredibly
efficient, they are typically more expensive and only used for high-volume commercial
drilling.

• TUMBLING:
Large amounts of irregularly shaped stones are frequently tumbled for extended periods of
time, which entails turning them slowly in a spinning barrel with abrasives and water (days
or weeks). The stones are gradually flattened and polished to accidental but frequently
quite attractive shapes by tumbling with progressively finer grades of abrasive (typically
silicon carbide) and cleaning thoroughly between grades. To maximise the stirring action of
barrel rotation, tumbling barrels frequently include hexagonal shapes in their outer shell. A
vibratory machine, sometimes known as a vibratory tumbler, is an alternative to rotatory
tumblers in which the contained barrel vibrates as opposed to rotating. The more stationary
arrangement of vibratory machines makes it much easier to examine the progress of the stones
inside, whereas standard tumblers must be halted in order to check progress. In addition to
polishing gemstones, tumbling is often used to polish large quantities of metal jewellery.
India has 10 special economic zones (SEZ) for gems & jewellery. These zones have more than
500 manufacturing units, which contribute 30% to the country’s total exports.

There are four methods of manufacturing. They are:

1.Electroforming:
In this particular method, copies of wax are created and varnished with electrically charged thin
layers of metal. The next process involves immersing those copies in an electrically charged liquid
that contains precious metals. These particles stick to the layered wax copies.

2. Hand Fabrication:
Hand fabrication is the process where each one of the elements is neatly formed, organized, joined
and finished using hands and hands only.

3. Die Striking:
The process starts with the production of a steel pattern known as a Die ( A die is specially fashioned
to create desirable jewellery). A specially designed die-striking machine will be carried out to cut the
blanks of the size and shape needed for the jewellery to be made.

4. Lost-Wax Fabrication:
The process requires the use of wax moulds to create silica-coated shells where metal is poured
down and granted to harden.
GROWTH DRIVERS
Growth drivers of gems and jewellery industry in India can be divided on three factors.
Them being:

• Population demographics
The main consumers of this industry are middle-class people and rich people. According to
population demographics, rise in both the segments of people is expected in the future.
India’s middle-class is expected to increase from 270 million in 2018 to 1,250 million in
2048. India’s rich population is expected to increase from 30 million in 2018 to 310 million in
2048.

• Rising gold demand

Rapidly increasing middle-class population has led to increase in the demand of gold. India’s
demand for gold is expected to reach 800-850 tonnes in 2022.
Between April and October 2021, imports of gold bars totalled US$ 1,372 million, while
imports of gold jewellery totalled US$ 166.75 million, according to the Gem and Jewellery
Export Promotion Council.
India's gold consumption was 797.30 tonnes in 2021, and by 2022, it is anticipated to reach
between 800-850 tonnes.
Demand for gold increased to 265 tonnes in the fourth quarter of 2021, up 93% from the
same period the previous year.
According to the World Gold Council, India's demand for gold climbed by 57 percent YoY to
Rs. 58,800 crore (US$ 7.9 billion) in the first quarter of 2021, and by 37 percent YoY to 140
tonnes in terms of volume. In the second quarter of 2021, demand for gold increased by
19% YoY in terms of volume to 76 tonnes and by 23% YoY in terms of value to Rs. 32,180
crore (US$ 7.9 billion).
Businesses fared better in the second quarter of 2021 compared to the same period in 2020
because establishments were better prepared for lockdowns. In the second quarter of 2021,
the total amount of jewellery demand rose by 25 percent YoY to 55 tonnes.
 Gold Demand in India
1000
900
800
700
600
500
400
300
200
100
0
2014 2015 2016 2017 2018 2019 2020 2021

In Tonnes

• Government initiatives
Gold Monetisation Scheme to reduce the country’s reliance on gold imports to meet the
domestic demand.
Proposed jewellery park allocated: 25 acres land in Navi Mumbai and 25,000 sq. ft land in
West Bengal.
Proposed policy to help increase the gold supply from local refineries to 80% in the next few
years from current 40%.
In Union Budget 2021-22, the government announced reduction on import duty for precious
metals (including gold and silver) to 7.5%, from 12%, that will help the gems and jewellery
exports market in India become globally competitive.
The Government has permitted 100% FDI in the sector under the automatic route, wherein
the foreign investor or the Indian company do not require any prior approval from the
Reserve Bank or Government of India.
MARKET STRUCTURE
The Indian gems and jewellery industry has quickly grown from its relatively modest origins
as a small, unorganised sector in the 1950s and 1960s to become one of India's top export-
oriented businesses and a substantial source of foreign exchange earnings for the nation.
However, a variety of elements, such as consumer preferences, properties, varieties, unit
values, applications, etc., have an impact on the demand for various types of G&J.

Based on the traits, processing methods, and preciousness in terms of price range and
marketability, the GJ Sector can be further divided into the following sub-sectors:
Gold and diamonds are India's two main economic sectors.
Retail jewellery market is considered as monopolistic competition as in this sector, there
are many producers selling differentiated products. There are many sellers and consumers
in the market and no business has full control over the market but producers still have a
degree of control over price as they sell their products by different brands.
For example: Tanishq have a brand name and their rates differ from other jewellers.
Indian gems and Jewellery Market, by Type:

• Gold
• Diamond
• Silver
• Gemstones
• Others
Indian gems and Jewellery Market, by Distribution Channel:

• Offline
• Online

Indian gems and Jewellery Market, by region:

• South
• North
• East
• West

Clusters in the gems and jewellery industry:

• Delhi
• Jaipur
• Surat
 • Mumbai
• Thrissur
• Coimbatore
• Nellore
• Hyderabad
• Kolkata

Exports of Gems and Jewellery Industry from India in 2021-22:

Destination Wise Exports (in USD Million)

4.50%
5.60%

17.30%
44.20%

28.40%

USA HongKong UAE Belgium Israel

PORTERS FIVE FORCES ANALYSIS
1) Threat of new entrants:
When we talk about the gems and jewellery industry, the barriers for the new entrants
aren’t high for the reason that the capital requirements to enter in this industry are low and
one can easily enter into this industry and can earn a name for the reason that the demand
for gold and diamond jewellery is high. It’s been called medium for the reason that the rules
and regulations by the government to enter in the industry are really strict. Also, to enter
into the jewellery industry, one requires skilled manpower for the reason that it is an
essential thing in this regard. The last but not the least thing that makes the threat of new
entrants’ medium for this industry in advanced technology requirement, which is really
essential to enter this marketplace.
2) Threat of Substitute Products
When we talk about the gems and jewellery industry, what can be the potential substitute
to gold jewellery and diamond jewellery? The most important substitutes of it that came to
our mind are imitation or artificial jewellery, stone jewellery or the bagasra jewellery etc.
But as a matter of fact, all these substitutes can’t deny the importance of gold or diamond
jewellery. The reason is that the way of living of the people is being enhanced with the each
passing day. The standard of living as well as the status of the people is on the high increase.
So, all these substitute products can’t produce a threat for gold or diamond jewellery for the
reason that these are high in demand so the threat of substitute products for the jewellery
industry of India remains low.
The other potential substitutes other than imitation or stone jewellery are stock market,
real assets, mutual fund investments as well as bank deposits etc.
3) The Competitive Rivalry:
This porter force deals with the inter-rivalry. For instance, when we talk about the gems and
jewellery industry of India, we look for all competitors in the industry. In this scenario, any
player of the jewellery industry faces two types of rivalry, for instance, the first one from
inside the country and second one from outside it. In this regard, it is obvious that the
competition amongst the firms is really high for the reason that the industry is too vast and
all the players of the industry are playing well, especially inside the country. When we talk
about the international competitors in the jewellery industry for India, China comes at the
top of the list. So, all these things combine to make the competition amongst firms really
high.
4) Bargaining Power of Buyers:
For jewellery industry, when we talk about the bargaining power of buyers, it’s quite low.
What can be the potential reason behind the low bargaining power of Indian Jewellery
industry? As a matter of fact, the Indian gems and Jewellery industry has two types of
buyers i.e., domestic buyers as well as the foreign buyers for both gold and diamond
jewellery. In this scenario, the position of India becomes string for the reason that the high
demand for the jewellery from inside as well as from outside the country gives the power to
the industry as compared to the buyers.
5) Bargaining Power of Suppliers:
In this industry bargaining power of the suppliers is medium. The reason is that India is one
of the largest players and is the main concern of the suppliers. For the country, there are
lots of suppliers available i.e., national as well as international. In this scenario, the
bargaining power of the suppliers should be low. But it is medium because that the
jewellery industry also needs the reliable suppliers to retain its position in the global market
so this is the reason for which the bargaining power of the suppliers remains medium for
jewellery industry of India.

CHALLENGES FACED BY THE GEMS AND JEWELLERY INDUSTRY IN INDIA

Dependence on import
The gems and jewellery industry is highly dependent on import for meeting its raw material
requirements and among the imported commodities rough diamonds account for
almost50% of the imports. India is also one of the largest importer and consumer of silver in
the world.

Fluctuations in Exchange Rate

Gems and jewellery trade is influenced by the rupee/dollar rate of exchange as a result of its
export & import orientating trade. Any variation within the exchange rates affects the
margins of the players.

Changing Consumer Preference

International marketing must stay up with the constantly changing jewellery and gems
trends, especially given the exorbitant prices of diamond, gold, and silver. In order to
receive feedback and develop the newest styles in order to keep up with the demands of
overseas consumers, the Republic of India does not have enough style development
centres. Manufacturers create a certain style of gems and jewellery products based on
consumer desire. However, because of changes in fashion, the market for that particular
product style begins to decline and eventually ends. In this instance, the manufacturer's
capital is restricted, which causes inventory to assemble.
GOLD PRICES
Gold prices in 5-year interval:
Data Table:

Year Price per 10 grams

1925 18.75
1930 18.05
1935 30.81
1940 36.04
1945 62
1950 99.18
1955 79.18
1960 111.87
1965 71.75
1970 184.5
1975 540
1980 1,330
1985 2,130
1990 3,200
1995 4,680
2000 4,400
2005 7,000
2010 18,500
2015 26,343
2020 48,651

Prices of Gold per 10 grams

60000

50000

40000

30000

20000

10000

0
1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020

Prices
Why were gold prices being so low before 1980s?
Investors chose paper over gold during the 1980s and 1990s because real rates were so
favourable. Gold did well both in the 1970s and the 2000s, while real interest rates were
falling. Investors are selecting gold over paper since the real interest rate is currently
negative, the short-term interest rate is only 0.3 percent, and inflation is currently at 1.4
percent. Gold will perform better in a world where interest rates are negative. They disliked
golf in the latter part of 2015, but as interest rates rose and gold was viewed as a safe-haven
asset in the early part of 2016, investors started investing again.
Why did people start investing in Gold and why are its prices are going up?

• When people have doubts about the government or financial markets, gold prices
soar.
• In times of political or economic unrest, gold is seen as a haven.
• A hedge against price increases and currency depreciation is gold. While the value of
money may change, the price of gold remains constant over time.
• Investors purchase gold when they anticipate a drop in the currency's value.
• Gold gains when the currency declines.
• When central banks have a deficit, investors purchase physical assets like gold to
safeguard their money.
• Gold prices rise as interest rates fall because holding gold has a lower opportunity
cost than holding other investments.
• Gold prices rise as interest rates fall because holding gold has a lower opportunity
cost than holding other investments.
• The interest rates decrease when there is a huge money supply, which occurs when
the central bank supports lending more money. However, this might cause inflation,
which would raise the cost of gold.
• When central banks purchase large quantities of gold as reserves, the price of gold
rises because there is a shortage of gold and an increase in the supply of currency.
• In China and India, there is a significant demand for jewellery. A significant portion of
the demand for gold comes from industrial uses.
• Cost of production has an impact on it. Miners sell gold for higher money when
production costs are high in order to protect their profits. When the gold is sold in
the market, this is reflected.
• When the economy is doing well, gold becomes more appealing, which raises
demand and drives up the price.

Factors affecting gold rates in India:

• Inflation
Due to its nearly constant nature in comparison to currency, gold has great value and is used
to protect against inflation. This is the reason why investors like holding gold over money.
As a result, the demand for gold rises during periods of high inflation and vice versa. Then,
as a result of intense consumer demand, gold prices will soar. This is valid for both domestic
and global inflation, including that which occurs in India.

• Global Movement
The cost of the yellow metal in India is impacted by any changes in the price of gold on a
global scale. This is mostly owing to the fact that India is one of the largest gold importers,
and as a result, when import prices vary as a result of movements in the price of gold
around the world, the same is subsequently reflected in domestic gold prices. Due to
investors' perception that the value of money and other financial instruments may decline
during political unrest, gold is more in demand and costs more during periods of political
unrest than during periods of peace. . The interest in buying gold rises among consumers
when their confidence in the government and markets falter and as such gold is called as
the crisis commodity.

• Government Gold Reserves

The central banks of the majority of large nations maintain reserves of both money and
gold. The Reserve Bank of India and the US Federal Reserve are two excellent instances of
this. The price of gold rises as central banks of major nations begin to accumulate gold
reserves and buy more gold. This is as a result of the market's increased cash flow and
declining gold supply.

• Jewellery Market
Gold jewellery is extremely popular in India. In Indian households, gold jewellery has a
special place, whether it's for celebrations or birthdays. Due to increasing consumer
demand, gold prices rise throughout the wedding season as well as during holidays like
Diwali. A mismatch between supply and demand results in higher pricing. Gold is in demand
for more than simply jewellery purposes. Several electronic firms use the metal in small
amounts to make products like televisions, computers, GPS units, etc. Gold is utilised in
India for jewellery needs, as a present item, as a status symbol, and as a reliable hedge
against growing inflation. All of these factors work together to drive up domestic gold
demand to the point that India frequently has to import significant amounts of the yellow
metal. 12 percent of the nation's entire demand for gold is met by the industrial sector. One
more is medicine.

• Interest Rate Trends

Gold demand and interest rates on financial goods and services are strongly related. In
general, the current price of gold is a reliable indicator of a nation's interest rate
developments. Customers often sell gold to obtain cash when interest rates rise, which
results in an increase in the supply of the metal and a decrease in its price. In contrast, lower
interest rates result in more money in consumers' pockets, which in turn increases demand
for gold and, consequently, the price of the metal.

DIAMOND PRICES
Price Chart od Diamond with VS1 Clarity:

Month Price per carat (in USD Grand)

August ‘21 26.20
September ‘21 25.74
October ‘21 25.92
November ‘21 26.71
December ‘21 28.14
January ‘22 29.50
February ‘22 31.56
March ‘22 31.68
April ‘22 29.50
May ‘22 29.43
June ‘22 29.26
July ‘22 28.60

PRICE PER GRAND OF VS1 CLARITY DIAMOND

In USD Grand

35
31.56 31.68
29.5 29.5 29.43 29.26
28.14 28.6
30
26.2 25.92 26.71
25.74
25

20

15

10

0
A u g ' 2 1 S e p t ' 2 1 O c t ' 2 1 N o v ' 2 1 D e c ' 2 1 J a n ' 2 2 Fe b ' 2 2 M a r ' 2 2 Ap r ' 2 2 M a y ' 2 2 J u n e ' 2 2 J u l ' 2 2
Price Chart od Diamond with VS2 Clarity:

Month Price Per Carat (in USD Grand)

August ‘21 24.10
September ‘21 23.97
October ‘21 24.00
November ‘21 25.12
December ‘21 25.62
January ‘22 27.35
February ‘22 28.72
March ‘22 28.68
April ‘22 26.77
May ‘22 26.72
June ‘22 26.44
July ‘22 25.77

PRICE PER CARAT OF VS2 CLARITY

Series 1

30
28.72 28.68
29

28 27.35
26.77 26.72
27 26.44
25.62 25.77
26 25.12
25 24.1 23.97 24
24

23

22

21
A u g ' 2 1 S e p t ' 2 1 O c t ' 2 1 N o v ' 2 1 D e c ' 2 1 J a n ' 2 2 Fe b ' 2 2 M a r ' 2 2 Ap r ' 2 2 M a y ' 2 2 J u n ' 2 2 J u l ' 2 2

Why prices of diamond increased in 2021?

As jewellery demand increased in important markets in 2021, diamond prices increased by
up to 20%. Despite a decline in demand, prices for both rough and polished diamonds were
constant in the pandemic-stricken 2020. The pipeline had remained steady throughout the
year due to restricted mining and finished goods output.
However, prices had started to increase due to an increase in demand in 2021. "Both
polished and raw diamond prices are high. Depending on the caratage, they had moved
anywhere from 5% to 20%. According to Sachin Jain, managing director of De Beers India,
the larger carat diamonds did become increasingly popular.
Prices and demand were driven by the US and Chinese markets.
According to Edahn Golan Diamond Research and Data, US jewellery sales increased by 41%
to $32 billion between January and May 2021 from $22.7 billion during the same time in
2019. Chinese jewellery sales had also increased by 14.3% in July.
“Exports growth is mainly attributed to the renewed consumer sentiments, especially in the
US, with the announcement of Covid-19 stimulus package of $1.9 trillion. With the
continued recovery in global markets, rise in disposable income of consumers, forthcoming
festive season in domestic and international markets, we are expecting the demand to grow
further in the coming months,” said Colin Shah, chairman, GJEPC.
“Even in India we have seen demand rising in June-July, though the data has not yet been
collated. Many weddings are being preponed and this is driving sales in the lean season of
June-July,” said Jain of De Beers. For the entire year, De Beers expects Indian sales to be 10
to 15 per cent higher than in 2019. The company is pinning hopes on the festive quarters in
the second half.
Only 15 to 20% less were spent on goods even in 2020. Although the lock-down had an
impact on the interim quarters, "we had a strong Q1 and a fantastic Q4", he claimed.
Even while demand is still high, there may be a supply problem. Pandemic cases were
already on the rise in South Africa, and if the situation worsens, output could be impacted.
The epidemic also caused a slowdown in production in 2020.
GEMS AND JEWELLERY INDUSTRY AND TECHNOLOGY
Traditional techniques of creating and marketing jewellery must change in order to
accommodate the unique purchasing habits of the millennial generation. The manufacture,
sourcing, and certification of gems and jewellery are changing as a result of innovation in
technology and other fields, and the Indian jewellery industry must keep up and adapt these
changes in order to remain competitive.
The gems and jewellery industry in India has shown itself to be a reasonably quick learner of
technology, combining traditional expertise and historical designs with contemporary
manufacturing and certification techniques. However, young consumers now and those in
the future are more concerned with exclusivity, story, and source than with monetary
worth. To fulfil these expectations, innovators have created technologies and procedures
that unleash storytelling and design. Using new production processes like 3D printing, new
materials, new tools like lasers, and much more, designers can give form to designs and
geometries that were previously impractical. Technological advancements in the
identification of gems and jewellery, such as devices and procedures that can distinguish
between natural and manufactured stones, satisfy the needs of transparency and social
responsibility.
Manufacturing and Distribution
The largest rapid manufacturing and prototype facility in India, Imaginarium India Pvt. Ltd.,
has achieved significant advancements in the use of 3D printing for the production of
jewellery and other items. Recently, Tanmay Shah, the director of innovation at
Imaginarium, participated in a panel discussion on innovation and technology at the India
Gold and Jewellery Summit 2019 in Delhi. According to him, technology might be used to
start the jewellery-making process with the consumer rather than at the end. "Customers
want to know how to participate in the creative process. With technology, you can create
and visualise designs, giving customers the opportunity to make changes before they are
produced. The jewellery industry has proven to be the best adopter of technology
worldwide. We started with CAD/CAM, employ direct castable RPTs (Rapid Prototyping
Technology) today and could directly 3D print metals in the future,’ he said at the event.
Identification and Certification
Lab-grown diamonds (LGDs) are without a doubt a part of the future of gem and jewellery
consumption. Credibility is at risk since today's customers want to know when they are
buying natural products versus synthetic ones. The midstream is also worried about fake
diamonds contaminating the pipeline and being sold as real gems. As a result, businesses
and research facilities have developed tools and procedures to distinguish between natural
and artificial stones. Massive Tech Lab in Surat has gem identification equipment that can
scan massive numbers of diamonds of different sizes and distinguish between naturals and
LGDs. Their G-Certain Synthetic Diamond Detector and J-Certain Synthetic Diamond
Detector for Studded Jewellery use German technology that can test all sizes (0.002Ct to
10Ct) and shapes of stones. They employ a real-time USB interface and can also scan
studded jewellery.
GOVERNMENT INITIATIVES TO SUPPORT THE INDUSTRY
• The government announced a drop in import duty on precious metals (including gold
and silver) to 7.5 percent from 12 percent in the Union Budget 2021–22, which will
enable the Indian market for gems and jewellery exports become more competitive
on a worldwide scale.
• The decision to demonetize encourages consumers to purchase jewellery with
plastic money and debit/credit cards. This is excellent for the industry in the long run
and will create more transparency.
• To prevent the parking of black money in bullion, the government will announce a
new limit for reporting to authorities about transactions in gold and other precious
metals and stones.
• The government's declaration about launching a gold spot exchange may enable
India to participate in setting the price of gold on the global market.
• The BIS mark, fitness, purity in carat, unit identification, and jeweller identification
mark will all now be included on the hallmark for gold jewellery. The action is
intended to guarantee a quality check on gold jewellery.
• The government mandated that all gold jewellery and artefacts bear the hallmark.
The implementation term is set at one year, or until January 2021.
• The Indian government introduced an online registration and renewal mechanism
for "Jewellers & Hallmarking" businesses in August 2020.
• The BIS web portal can be used to access this online system (www.manakonline.in).
• In November 2015, the Gold Monetization Scheme was introduced. With the help of
this plan, individuals, trusts, and mutual funds could deposit gold with banks and
receive income in exchange.
• In order to raise deposits over the upcoming months, the Reserve Bank of India (RBI)
expanded the scope of the gold-monetisation scheme in January 2019 by permitting
charitable organisations and governmental bodies to deposit gold.
• The Finance Ministry announced in December 2020 that traders in precious metals
and stones must keep records of all cash transactions of Rs. 10 lakh (US$ 13.61
thousand) or more with a single customer, as amended by the Prevention of Money
Laundering Act (PMLA).
• The government was urged by the Gem and Jewellery Export Promotion Council
(GJEPC) to include the EDI connection of postal services with customs in the
comprehensive e-commerce policy in December 2020 so that banks could
automatically close e-commerce exports against advance credit card payments made
by foreign buyers.
• The action would encourage progressive improvements to support the sector's long-
term objective of becoming the hub of the world's gems and jewellery.
• The US delayed new tariffs on six nations, including India, in June 2021 for a period
of up to six months if they had implemented or were considering levying an
equalisation tax or a digital services tax on e-commerce enterprises.
 • This was carried out in order to buy more time for the Organization for Economic Co-
operation and Development (OECD) and G20 to finish their multilateral negotiations
on international taxation.
• The COVID-affected gems and jewellery sector in India will probably feel some
respite as a result of the suspension.

GEMS AND JEWELLERY INDUSTRY IN ESG

Nowadays, it seems as though sustainability and ethics are at the core of almost every
jewellery brand you Google, yet this sector, like fashion, calls for a critical eye to distinguish
how pure a company's products are.
ExJewel's "Conscious Jewelry Trend Report 2020" found that searches for "ethical diamond,"
"lab-grown diamond," and "ethical gold" had all increased year over year, indicating that
consumer demand is, in fact, driving the demand for sustainable jewellery.
Sustainable Practices
Recycling precious metals internally or obtaining them from reliable vendors outside the
company is one option for brands to lessen their reliance on mining. Silver and gold,
fortunately, won't lose their properties as a result, which is why some businesses may even
have "buyback" efforts in place. The most environmentally conscious jewellery companies
will work to minimise waste and their carbon footprint at every stage of their operations,
from recycled items and packaging to carbon-neutral shipping and renewable energy
initiatives.
Lab-grown / mined Diamonds
According to the most recent data, 70% of consumers in the millennial age group are
interested in buying lab-grown diamonds for engagement rings. While the companies that
make these alternatives could try to position themselves as "eco-friendly," it's necessary to
look at the facts. Given that approximately 250 tonnes of ore are uprooted for every single
carat of polished diamond, it may not be ethical for millions of mining workers in developing
countries to lose their jobs as a result, even though diamonds grown above ground with
renewable energy generally cause less environmental harm.
Eco-friendly and Ethical Jewellery
Jewellery with very less or no impact on the environment, including minimal carbon
footprint, is considered eco-friendly. Eco-friendly jewellery includes ornaments composed of
synthetic diamonds, pearls, gemstones, and recyclable materials. Vintage jewellery is
another illustration of eco-friendly clothing. Understanding how mining and manufacturing
of jewellery affects the environment is a crucial first step in eliminating the many
environmental concerns that arise from this process.
Aside from eco-friendly jewellery, another crucial factor to think about while purchasing is
the jewelry's ethical standing. The term "conflict diamonds" is probably one that most of us
have heard of. Conflict diamonds are those mined in areas affected by civil war, upheaval,
and agitation. Poor, underpaid workers, including child labourers, collect the valuable stones
dug up in these places, in contravention of the laws protecting human rights. The money
made from selling the diamonds to businesses around the world is used to buy weapons to
further occupy the territory. This is the most significant and applicable definition of
jewellery that violates morality and takes advantage of every worker involved.

Global Brands that Sell Ethical, Eco-friendly Jewellery

1. Rene Stewart and Monarc: Manufacture handcrafted trendy jewellery as per Fair
Trade certification. Most of their sustainable jewellery is made from recycled
material.
2. Emma Aitchinson: British designer who uses jewellery as a platform to raise
awareness about climate change.
3. Simply Wood Rings: Offers a wide variety of wooden wedding rings with exotic inlay
for the co-conscious.
4. Brilliant Earth: This brand is one of the best in the world offering ethically sourced,
conflict-free diamonds. It also manufactures lab-grown gemstones for the socially
conscious consumers.
5. Eco Lustre: Offers handcrafted artisan jewellery that is sustainable, and made with
eco-friendly materials.

Eco-friendly Jewellery Brands in India

1. Daughters of the Ganges: Provides clients with exquisite home-made jewellery
made by craftsmen and women.

2. Love Darling: Sells personalized jewellery, usually made in pearls. It is inspired by

UN’s SDGs.

3. No Nasties: Utilizes Fair Trade certifications to manufacture organic and vegan

jewellery with little impact on the ecosystem.

4. Ba No Batwo: Mostly features ethnic jewellery. Utilizing hand-crafted items made

from recyclable materials, art from tribal regions coalesced with the newest fashion
trends and second-hand stones, this brand truly inspires awe.
 5. Ananda Soul Creations: Offers gemstones, blessed by priests, and handcrafted to
perfection. The designs by this brand are bound to adorn brides with majesty and
earthly beauty.

Certifications to look at when talking about Sustainable Jewellery

• Fair Trade Certification Mark

• Fairmined Certification
• Responsible Jewellery Council
• The RJC’s Chain-of -Custody Certification
• SCS Certification
• Kimberly Process Certification (KPCS)