In recent years, weakened consumer demand for diamond jewellery has pressured India’s cutting and polishing industry.
In the past year, the Gem & Jewellery Export Promotion Council (GJEPC) led the charge on a two-month voluntary moratorium on the import of rough between October and December.
This led to an easing of the supply-demand imbalance. This was the third import ban of the past 15 years, with a similar strategy used during the Global Financial Crisis (2008-09) and the COVID-19 pandemic.
This strategy removes excessive build-up of rough in manufacturing centres and decreases the pressure to purchase rough. It also creates liquidity in the middle market due to the lack of purchasing, which leads to a renewed demand for goods once the ban is concluded.
It’s viewed as a short-term, immediate fix; however, GJEPC chairman Vipul Shah said that wider concerns in the market need to be addressed.
“An import freeze is not a solution. We have to plan for the long term,” Shah told Rapaport News.
Shah added that China’s slow recovery from the pandemic was a critical concern that must be addressed.
The De Beers Group recently published the results from its fifth sales cycle, documenting a notable decline from the fourth cycle (18 per cent) and the third cycle (29 per cent).
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