Demonetisation, GST maul gold jewel industry's growth

Coimbatore/ New Delhi: The gold jewellery industry in the country has not witnessed any significant growth in the last two years, particularly after demonetisation and GST, the national apex body of gem and jewellery said Tuesday.

Though the majority of the population of the older generation saw the precious metal as a long-time investment, the change in the lifestyle of the younger generation, who opted more for travelling and automobiles, has applied a brake on the jewellery business, chairman of Gem and Jewellery Domestic Council (GJC) Ananth Padmanabhan told reporters here.

After the demonetisation in 2016 and introduction of the goods and services tax, the growth of the industry remained stagnant despite the country being the second largest importers of gold (800-1,000 tonnes per annum), he said.

Though the council has no exact figure of gold consumption in the country, the import of the metal however, recorded negative growth since the beginning of the year, he said. The council is organising a three-day event 'Preferred Manufacturer of India' which began here Tuesday.

The event saw 42 top gem and jewellery manufacturers displaying their designs for the benefit of retailers in and around Coimbatore and in the southern parts of the country, he said.

Being the first-ever event of this kind, it would be a bridge between the makers and retailers on Business2Business model, immediate past chairman of the council Nitin Kandelwal said.

Meanwhile, in Delhi gold prices advanced by Rs 40 to Rs 32,690 per 10 gram at the bullion market Tuesday on continued buying by local jewellers, even as the global trend marked a decline. Silver, however, met with resistance at prevailing higher levels and shed Rs 210 to Rs 39,800 per kg.

Traders said sustained buying by local jewellers at the domestic spot market to meet increased demand kept gold prices higher but a weak trend overseas limited the gains. Globally, gold fell 0.54 per cent to USD 1,282.40 an ounce and silver shed 0.74 per cent to USD 15.60 an ounce in New York.

A depreciating rupee against the dollar made imports of gold costlier, which supported the uptrend, they said. The rupee weakened by 46 paise to quote at 70.14 (intra-day) against the dollar at the forex market.

In the national capital, gold of 99.9 per cent and 99.5 per cent purities rose by Rs 40 each to Rs 32,690 and Rs 32,540 per 10 gram, respectively. The metal had gained Rs 150 in Monday's trade.

Sovereign gold, however, remained flat at Rs 25,200 per piece of 8 gram.