The Chairman of the Gems and Jewellery Export Promotion Council (GJEPC) in India, Vipul Shah, issued a sobering warning to the press, indicating that the dwindling demand from crucial markets poses a grave threat to India’s gems and jewelry exports. This concern comes as June figures reveal a sharp decline of over 31% in year-on-year exports of polished diamonds.
Shah elaborated on the challenges at hand, stating, “We anticipate a notable decline of approximately 10 to 15 per cent in the realm of gems and jewelry exports. The United States and China, pivotal contributors to this sector, are both experiencing a deceleration in demand. Factors such as escalating interest costs, inflation, and waning consumer confidence compound the predicament.”
A recent industry report published by IDEX Online delved further into the sector’s predicament, highlighting the financial struggles endured by nearly half of India’s diamond workers. As global demand dwindles, factories are resorting to reduced hours and wages, a measure undertaken to cope with the challenging market conditions.
Approximately 500,000 cutters and polishers, a cornerstone of India’s jewelry manufacturing sector, are remunerated based on either a per-carat rate, ranging from $12 to $18, or a per-piece basis. Regrettably, numerous factories have resorted to truncating workdays, subsequently leading to diminished compensation for many workers.
Bhavesh Tank, a prominent figure leading the Diamond Worker Union, shared insights into the current plight, disclosing, “This year, an unusual extension of the summer vacation by up to 15 days was observed in a few units. However, despite this, market dynamics remained unfavorable. Consequently, in a bid to curtail production, medium and small-scale units have transitioned to operating five days a week, accompanied by a reduction in working hours from 11 to approximately six or seven hours.”
The somber mood surrounding India’s gems and jewelry sector underscores the urgency for proactive measures to revitalize demand, stabilize the workforce, and navigate the evolving challenges that loom ahead. As stakeholders remain vigilant, the industry seeks avenues for recovery and rejuvenation to safeguard its pivotal role in India’s economic landscape.
