India's imports of rough diamonds are likely to jump by a quarter in the next fiscal year from $14.5 billion now, as exports of the processed gems to top consumers increase and Indian exporters enter newer markets.
India, the world's largest processor of rough diamonds,
gets most of its supply from firms such as top producer De Beers ,
mining giant Rio Tinto, and Russian state-owned Alrosa. It is looking to
boost exports and cut imports to rein in a ballooning current account
"We will go to newer markets to beat the slowdown, for example, the countries of the former Soviet Union are buying in huge quantities from India," said Pankaj Kumar Parekh, vice chairman of the Gems and Jewellery Export Promotion Council, which represents more than 5,500 of the country's exporters.
The trade body expects India's exports of cut and polished diamonds in
the fiscal year to March 2014 to be 25 per cent higher than current
estimates of $16 billion, equivalent to 66 per cent of total gems and
It expects exports of gems and jewellery to
rise 6.6 per cent to $50 billion. Exports of gems and jewellery - which
include diamonds - constitute 14 per cent of India's total trade, and
employ 3.4 million workers, with the Middle East taking most of India's
gems and jewellery shipments.
Demand from the euro zone could be
depressed because of the region's debt crisis, though he bet on a
revival in demand from the United States. "Things are in the doldrums in
the European Union, and the buoyancy is visible in India and China," said Parekh.
India processes about 92 per cent of the world's diamonds, followed by
Belgium, Israel and China. Most of the diamonds are sourced from world
miners through Dubai.
World diamond production has been steady at
120 million to 130 million carats or roughly about $15 billion in value
terms, putting an upward pressure on prices, the Council said. Miners
are unlikely to ramp up production without a massive improvement in the
world economy, it added.
Exports of silver jewellery are likely to grow at a robust pace next
year, as growing numbers of buyers opt for the cheaper metal in the
facing of rising gold
prices. "Middle class consumers are finding gold expensive, and the
metal is being replaced by silver," said council official Sabyasachi
A 10-gram quantity of silver is valued at 547.8 rupees,
against 29,766 rupees for a similar quantity of gold. Exports of silver
jewellery rose to $715 million in the 11 months to February, an annual
increase of 10 percent, compared with flat exports of $18.12 billion of
gold jewellery, data from the trade body showed.