The All India Gems and Jewellery Trade Federation (GJF), a national body for the promotion and growth of trade in gems and jewellery across
India, has a target to increase the industry’s total turnover to Rs 125,000 crore by 2012. The federation is looking at managing the various aspects of fair trade practices and efficient organisation of business in the gems and jewellery industry.
GJF chairman C Vinod Hayagriv spoke on the main issues facing the industry and the road ahead.
What are the concerns of the industry and what are the issues that need to be addressed in the upcoming budget?
There are several issues before before the Centre at present, and these include allowing gold to be imported under open general licence by any member of the All India Gems and Jewellery Development Council who has annual revenue earning greater than Rs 50 crore.
Direct imports by jewellers and jewellery manufacturers lower costs and improve return on high investments in the intensely competitive climate prevailing these days.
This move can be broadbased further by allowing trade bodies to import gold for distribution to small jewellers at low cost.
What about import duties?
The Centre should consider zero duty on gold imports so as to shift world trade to India. Indian importers will then import gold and scrap gold, set up refineries, refine the gold and supply to domestic trade and re-export. There will be an opportunity to make a brand India bar gold, just like the Emirates and Swiss bars that the world consumes. If India does not act swiftly, given the collapse of Dubai, China will snatch the opportunity that is available today, and in the process move world trade to China.
Also, the Asean free-trade agreement that was signed for zero duty imports within Asean countries comes into effect in 2012, and this could give India a headstart. The GFJ feels that if the duty is not bought down, the government should plough back 25% of the duty so collected into several measures for improving trade. These measures should include setting up jewellery parks to rehabilitate craftsmen in scientific buildings and parks.
Other measures that need to be advocated include a national festival to garner worldwide publicity for India’s jewellery trade; and allowing ID cards in the form of smart cards for easy and safe transit of jewellery across country. Currently trade faces too much harassment, bribery and hardships when transporting the precious cargo in India.
What about fair trade practices?
Statutes and laws need to be passed to enable gold jewellery to be mandatorily hallmarked. At present, the law in India does not allow mandatory provision to be enacted. Also, instructions need to be issued to all states to allow one weights and measures calibration certificate to be recognised statewise.
The situation now is not very happy. Every city in each state wants separate calibration certificates, causing unnecessary trouble to chain stores and travelling exhibitions.
What is the outlook ahead for the overall industry? Will growth continue to be bullish?
For sure, yes. There is a need to protect the small jewellery businessman. Several small enterprises are finding it hard to exist with severe competition and margin squeeze and high cost of capital and high investments. Still, if the Centre were to implement our stated agenda, the gem and jewellery trade will grow beyond the Rs 125,000 crore we anticipated. We need proactive action quickly.
One of the problems being faced by the jewellery business is unethical trade practices. So what it GJF is doing to remove these?
We are actually explaining to traders and members the aspect of ethics we have espounded. We also publish the same in trade magazines so as to reach all over the country. We have also made it mandatory for our members. However, I still see it taking more time. Ethics is a bigger issue and it’s not easy as can be seen in other industries too. Piracy, plagiarism, under-invoicing, advertising ethics, dishonest representation in technical products such as jewellery is a challenge but GJF is working hard.
Source : The Economictimes