India is a major exporter of manufactured and handcrafted jewellery, as well as diamonds, processed in Mumbai and Surat, and polished coloured gemstones, cut and manufactured in Jaipur, to the United Kingdom.
The UK has a large British-Indian population with tastes for 22-karat gold jewellery, offered by independent British-Asian retail shops clustered in areas such as Green Street, Southall and Wembley in London; Leicester, and Birmingham.
The UK is the world’s sixth largest economy, after India in fifth place. With longstanding commercial, cultural and language ties between the two nations, the UK is an important market for Indian jewellery exporters, particularly after the country left the European Union (Brexit.)
A key focus now is whether or not inflation can be brought under control, after the year-on-year rise in UK consumer prices in June eased more than expected to 7.9%, from 8.7% in the year to May.
Inflation is now at its lowest for more than a year, after several months of being stuck around the same level.
A prolonged period of rising interest rates, with further rate increases expected later this year despite the recent fall in inflation, has squeezed disposable incomes in the United Kingdom, making it less affordable for many middle-income consumers, facing stubbornly high mortgage, food, and energy costs, to spend on luxury items including jewellery.
Footfall in UK jewellery shops has eroded due to the cost-of-living crisis, jewellers say, amid fears that wedding planning will take longer, as couples may delay ring purchases due to price pressures.
Demand for silver and cultured pearl jewellery at the UK retail level is seen as resilient, with margins on mid-range watches sales tight due to competition from smartphones.
Demand for pre-owned high-end watches such as Rolexes remains firm in UK jewellery shops as new Rolexes remain out of reach.
The outlook for bespoke business, customisation and repairs for UK jewellery retail is buoyant, jewellers say, in line with a global trend for personalisation of luxury across income groups.
