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It is good to buy diamonds

10 march 2009

On February 20-23, the Indian Gems and Jewelry Export Promotion Council (GJEPC) held the IIJS Signature Jewelry Show in Goa. The Kala Academy Cultural Center sprawled its 1500-square-meter pavilion for 73 exhibitors to display their best works of jewelry art. The Russian delegation was assisted by the Moscow Diamond Bourse to take part in this exhibition. Rough&Polished correspondent Alexander Shaburkin talked to GJEPC Vice-Chairman Shri Rajiv Jain, who described the peculiarities of the Indian jewelry industry in its development and the trends in the world diamond trade.

Mr. Jain, what are the major tasks and functions of GJEPC?  

The main work of the Council is to promote exports and the ties between the members and the government. If some member should have any difficulties, if there are some policy issues or procedural issues we go to the government to rectify the policy according to the requirements of the members and if the government has any issues with the members we take the members to the government and try to breach the gaps between the members and the government. And the other major aspect is export promotion which includes meetings, contacts, exhibitions which we take care of. These are the basic elements of our activity. Now, as for these shows, we have big international jewelry shows always here in Mumbai during the last 25 years and during the last two years we have been trying to show the best jewelry produced in this country, actually the best of the best which can be catered to any part of the world. If the Mumbai Show is a large show accounting for several hundred exhibitors, this one is a niche show of 73 exhibitors from all over the country and we do not allow any exhibitors from outside the country because we want to develop what we have in terms of heritage, in terms of craftsmanship. This is what we are trying to project. And there is the second thing about it: we want to make it a tradition to meet in Goa in the same month and there is a hope that all of you will be again invited.

In your view, what are the outlooks for cooperation between India and Russia in the jewelry sector?

What we want from Russia is cooperation in the information field. Unfortunately Russia is a country on which we have insufficient information; we need information about its business, about what we can do together, so we would like Russian jewelers and Indian jewelers to have cooperation to double our business between both our countries. This is the main idea. We would like to sell our products to your country and to buy your products, may be tons of raw diamonds among them.

To develop two-way cooperation there may be joint ventures…

Joint ventures also may serve to supply. So with that intention we want to have more interaction between jewelers internationally.

Mr. Jain, what is your evaluation of the products displayed at this exhibition? What are their distinctions?

There are two distinct categories of manufacturers here: one is mass manufacturers; these mass manufacturers are very modern in their technologies; they have the works that are on all the time, because they are in the process of creating thousands of pieces of the same design.

The second category is jewelers that are creating exclusive pieces. More often than not they do not repeat these pieces. This is because they are made around a special stone or specially cut stones or whatever else. Sometimes these people who work in this field even require permission of those who order these things for circulating the images of these pieces.

I know of someone here who refused to supply to Cartier because they refused to put his name on his works.

Unexpectedly, Shri Rajiv Jain, himself venturing the role of a correspondent, asked to give an opinion of the exhibition:

You must have visited many shows. May I ask you how did you find this one compared to some others?

Moscow is big, there are many shows there.

So the Rough&Polished correspondent had to give this opinion:

In my view, IIJS Signature is more compact, more elite. We had an opportunity to see jewelry pieces brought here from all India which were the best from the point of view of our hosts. So we can follow certain local trends.

But nevertheless I had a question in this context – the Goa Show had been conceived as an exhibition mainly targeted at foreigners and last year it was aimed mostly at the Americans. This year, in our view, it is meant for the local market. What is the reason for this? Was it that the companies feared no delegations would come?

It is not true. The point is that the people who were catering to the U.S. market were not showcasing almost one hundred percent because they felt that nobody from the U.S. market was going to come. This was the only difference.

We have met here various delegations, including our today’s meeting with the representatives of Azerbaijan and yesterday’s meeting with the representatives of Uzbekistan. The latter admired what they have seen here. For their customers this is something they are really after. It seemed to us that for Russia all this was a bit too much, too garish so to say.

I will give you a list of companies which if you visit them will show you things made like in the Western world.

Mr. Jain, with your permission, let us turn from local to global problems. What are the problems, in your opinion, generated by the world financial crisis for the diamond sector?

Unfortunately, Martin Rapaport is missing today to answer the problems of today’s market. As for the crisis, we have to live through it whatever it is. And the solution to it may not be found if we sit idle, we shall not have a way out. So we have to make efforts to improve our design, manufacturing process.

What are the obstacles hindering India to expand its products to other countries?

When difficult time comes people start thinking of this kind of things and when everything is good they think of anything else. Now that the crisis has come people will start thinking of other means of production, human resources and financial resources. You won’t believe it but we have a big opposition to this issue. People are not ready to see that we are upholding our issue in this crisis, we are making investments but with the 73 exhibitors money is going down the drain. And in spite of all this we have to go further in this crisis so that every exhibitor could have some result.

What are, in your opinion, the major trends in diamond jewelry sales across the world?

Small diamonds are selling well. Prices for small diamonds have not gone as low as for bigger diamonds.

What was the change in price for small diamonds, if there was any?

Small diamonds have gone down in price by 10 to 15 percent, but larger diamonds went down almost 40 percent. And take into consideration that compared to other industries and other commodities diamonds have not gone down that far. Take for instance oil or stock market where prices have gone drastically down, and diamonds still have their standard.

Do you have some export from India?

Yes, we have.

May polished diamonds play the role of an investment instrument under the current crisis conditions?

Alex, I’m sure you read Ken Gassman's report on IDEX Online. Diamonds are the only commodity in the world which has shown consistent growth over the period from January 2008 to January 2009. So in my opinion it is good to buy diamonds. People have a very short memory and that’s why they don’t realize that between 2004 and 2009 diamonds have shown consistent growth every year. If you take Januaries of 2004, 2005, 2006, 2007, 2008, 2009 it’s been nearly a straight-line graph. But considering the short memory that people have they only remember the period from April to October 2008 when diamonds piqued, not characteristically and totally out of the blue, but they piqued to 30-40 percent. But nobody in the diamond industry or among investors or consumers has lost money between January 2008 and January 2009 – they made two percent or four percent.

Alexander Shaburkin, Rough&Polished from Goa-Mumbai-Delhi