Vasant Mehta joined Gems & Jewellery Export Promotion Council (GJEPC) in the year 1969 as an honorary member. From then on, he has been holding several important positions including that of vice chairman of the Council. In October 2008, he took over as the chairman of the Council and since then, has been instrumental in bringing his expertise as a Convener of the Banking Insurance and Taxation Committee to the Council. Here he speaks about the various steps taken by the Council to reduce some of the factors ailing the gems and jewelry industry today and the ways and means of tackling the situation.

The Council is all set to explore the Middle East market with its ‘Brand India’ campaign. Besides the Middle East, which are the other countries that the Council is thinking of exploring? Can you please name some newer untapped markets around the globe?

We are also exploring CIS, China and Vietnam and have already begun our promotional efforts. There are many other markets like the New Zealand, Brunei, North and South Korea and Ireland which are still untapped.

GJEPC had also urged the Government to increase the measure of rupee interest subvention from two percent to four percent and extend the same to dollar credit. How well was this taken and how helpful has this been for the industry?

Unfortunately, the government has not increased the subvention to four percent and also to the dollar credit. If it would have been approved, our cost of production would have come down and our product would have been competitive in the international market.

What are the other initiatives taken up by the Council to uplift the sagging industry?

In the initial period, our first step was to request our members to reduce the import of rough diamonds so that there was no pressure on the inventory. This reduced production has helped the industry to pause and examine the effect of the recessionary period.

Our next effort was to reduce our cost of finance and for that we approached the government and the banks to reduce the interest rates.

We held regular meetings with international advisors/analysts and offered their viewpoints to our members.

We also appealed to the producers/miners to curtail their productions and not to force raw material to an already jammed pipeline. Regular meetings were held with the financing banks to apprise them of the market conditions and requesting them to take suitable steps. On the marketing scenario, we stepped up our promotional activities and appealed to the world organizations to do the same on a global level.

For our workforce (artisans), we ensured that the unemployed and/or laid off workers get financial help for the education of their children. A sum of Rs 1.75 crores is being distributed for this purpose.

Not only the diamond exports, but the coloured gemstones, pearls, non-gold jewellery and synthetic stones have also have fallen substantially. For this matter, some jewelers in Gujarat have temporarily turned to imitation jewelry manufacturing. What is your opinion about it?

We have no information of anyone turning to imitation jewellery. Since the world markets are going through a lean period due to the recession,we do not expect any growth in the gem & jewellery industry exports (which includes colour gemstones, pearls and synthetic stones) for the next few months.

What do you have to say on the Task Force set by the Reserve Bank of India to look into the problems faced by the diamond industry in Gujarat? Do you think more such forces should be set up to help the industry?

Basically, the export industry is mainly located in Mumbai and as such a Task Force should have been set up to look at the problems of the exporters in Mumbai and also all over India. The Diamond Industry in Gujarat is more on the manufacturing (cutting and polishing) of diamonds and as such, the major problems of that region are connected to employment and lay offs.

Can you please provide some details on the MoU signed between the Council and Shanghai Diamond Exchange for Indo–China co-operation in promoting the jewellery sector during IIJS Signature in Goa? When is this likely to be implemented?

We have been aggressively increasing our promotional activities in China as this market is growing at a good rate. In the last two years We have taken our members twice to Shanghai and Shenzhen and held buyer-seller meets in addition to a delegation which interacted with the Chinese industry.

Shanghai Diamond Exchange has offered us good help in these activities and as such we have now signed an MOU for further cooperation in promoting gems and jewellery sector in the mutual interest of both industries.

IIJS in Mumbai will be visited by a high power delegation led by SDE. The Indian industry will organize more buyer-seller meets in Beijing and in Panyu later this year. We acknowledge help of the Chinese government in all these efforts.

There are plans of launching a nation-wide three-year programme for domestic generic promotion of polished diamonds covering the metros as well as tier-II and tier-III cities. Can you please throw some light into this development?

Our domestic market is also growing with new demands and this has helped the manufacturers sell their goods locally. As such we have now embarked upon a project whereby we will offer a platform to the manufacturers and the domestic retailers to contribute to a programme of promoting diamonds and diamond jewellery in India. This will be a long term programme and would help excite demands in the local markets.

The Council had appealed to all the rough producers to curtail the supply of rough diamonds to maintain stability and confidence in the diamond market. How helpful and successful was this appeal and are you going to implement similar appeals in the future also?

The producers have been very helpful in this. De Beers and other producers have curtailed their productions and Russia has also reduced their sales of rough diamonds. I cannot say if they did it in response to our appeal but they realized that due to reduced demands from the manufacturers excessive production and supply would hurt all the stakeholders in the pipeline.

What is the way ahead for the GJ industry now?

Well, we are all waiting for the turnaround in the pattern of consumer buying of this luxury item. Luckily for us, in the Indian industry there has been good support from the domestic market. In the international markets also we see some movement especilly in the medium-priced small and large goods and this could well be the end of recession for the Indian industry.

Courtesy: www.gjepc.org

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