India’s Prime Minister Mr. Narendra Modi has been able to give Indian economy the booster dose which was badly required within first three months of his coalition government led by his Bhartiya Janata Party (BJP).
His prime goal, as he had declared before the general elections, was to provide India a stable and work-efficient government at the centre which is must for a country for its growth. His second goal was to improve the shabby condition of the Indian economy by creating a congenial atmosphere for attracting foreign direct investments which is also must for enhancing gross domestic product and generating larger numbers of employment.
Mr. Modi has achieved both these targets within first three months of his government’s inception. As a part of his pre-conceived strategy in his mind, Mr. Modi has started improving India’s relations with the neighbor countries, first among them were Bhutan and Japan and the last and recent was Asian giant China.
During Mr. Modi’s recent official tour of Japan, the Land of Rising Sun has pledged to invest about USD 35 billion in India’s various sectors like railways, infrastructure, energy etc. while China’s President Mr. Xi Jinping has promised to invest USD 20 billion in India over the next five years and also has agreed to provide greater market access to Indian products in farm, pharma including gems and jewellery sectors, with a view to reducing the large trade gap with India.
It may be noted here that an MoU was signed between India’s Gems and Jewellery Export Promotion Council (GJEPC) & China Gems Center (CGC) recently during a jewellery show in Jaipur which would facilitate smoother exchange of gemstone and jewellery between India and China. Accordingly, Indian manufacturers are now eager to set up their trade centres in China.
With exclusion of talk about other sectors, we will discuss about India and China as a major global force which drives and dictates the terms in gem & jewellery sector. While India and China together account for about 70% of the world’s gold market, China has achieved the status of the fastest growing global market for diamond jewellery as the country has seen an increase of 30% in the number of diamond jewellery retail doors between 2010 and ’13. On the other hand, domestic diamond jewellery markets of both India and China rose by a compounded annual growth rate of 12% in local currency terms between 2008 and 2013, according to a report recently released by the De Beers.
The Managing Director of Rio Tinto Group Mr. Jean-Marc Lieberherr has also given positive indications about the new Indian government. He recently said during the September ’14 Hong Kong fair, “We are sure to see strong growth in India as soon as the country gets its house in order with the new government. The middle class in China and India, supposed to be the world’s fastest growing jewellery market, can double by 2015 in comparison with 2010, boosting demand for diamonds.”
China and India, where about an estimated 21 million weddings take place every year, may account for half of the growth in diamond demand in the next five years from 2013, market experts say. India and China, the two major forces in global market are now striking closer ties in the fields of gem & jewellery to become decisive drivers in growth of the industry.
Posted by Suresh Chotai