VICENZA, Italy, January 24, 2010 – Diamond jewellery will feature more often in Indian weddings in coming years as more people will be able to afford it as incomes rise, Indian jewellers attending VicenzaOro First trade fair said.
By Amanda Grateley
The current period running until the end of March is auspicious for weddings in India.
Hemant Shah, Mumbai-based director of Hammer Group, estimated that demand for diamond jewellery in India was growing at around 15-20 percent a year.
Diamond jewellery is inaccessible to the poorest in society, but is becoming increasingly popular in higher income groups, Indian jewellers said.
“Studded (diamond set) jewellery sales are going up day by day,” said Anurag Godha, Managing Director of Mumbai-based Shantivijay Jewels Ltd.
“Younger people now have higher paid jobs, so they tend to buy diamond jewellery which they previously could not afford.”
The global economic crisis had impacted India less than many countries, and so jewellery demand was more resilient than elsewhere, Indian jewellers said.
However, they affirmed that demand for gold jewellery for Indian weddings and parties had suffered, largely due to the recent volatile surge in gold prices to near record highs.
Some jewellers said that demand for gold jewellery would probably hold up in India if prices rose steadily, but the recent volatility in prices had led some consumers to stand back and remain on the sidelines.
Increased quantities of recycled gold were entering the market for the manufacturing of gold jewellery, as many people had cashed out of jewels to take advantage of the surging gold price, jewellers said.
Gold is seen as a hedge against inflation.
“The outlook is that recycled gold will be used even more in manufacturing jewellery,” Shah said.
Demand for 18-carat white gold, used in combination with diamonds in studded (diamond set) jewellery, was picking up in urban areas and was increasingly popular with well-educated and internationally aware consumers.
“There are more and more people who go for studded jewellery rather than plain gold jewellery,” Shah said.
Platinum has also gained ground in India due to the closer proximity between gold and platinum prices, but remains a long way behind gold in terms of its popularity at Indian weddings.
“Yellow gold is the most popular metal. If the gold price keeps rising, but is not so volatile, people will keep buying gold,” said Kapil Nevatia, director of Mumbai-based Eleganza Jewellery Ltd.