Economic downturn makes gold exporters look beyond US

November 12th, 2008 - 1:45 pm ICT by IANS  

Kolkata, Nov 12 (IANS) With sales in their biggest market, the US, beginning to wane following the global financial meltdown, Indian gold jewellery exporters are now turning towards former Soviet republics and east European countries.”We have started looking at emerging economies of southern CIS (Commonwealth of Independent States) countries and east European nations,” Pankaj Parekh, chairman (eastern region) of the Gem and Jewellery Export Promotion Council, told IANS here.

Earlier, the US was the biggest destination for the gold exporters in India. But after the subprime crisis, gold trade to the US has started to ebb.

“We have seen a 30 percent drop in gold demand from the US and have started looking at other markets like the Middle East and the CIS to compensate that loss,” Saket Mehta, a partner of Mirage Creation, said.

Mirage Creation, a 14-year-old Mumbai-based company, has 22 retail outlets all over Canada. It also has presence in New York, Tokyo and Israel. Since its inception, the company has exported the maximum of its gold products to the US, Mehta said.

Though the company has started exporting to the new destinations, it would take another four to five years to establish its market presence in those places to the extent Mirage had in the US, he said.

Wide fluctuations in the value of the rupee have made prediction of quantum of exports during the current fiscal difficult, Parekh said.

He predicted a drastic fall in exports to the US in 2008-09, which had been accounting for 26 percent of total Indian exports.

“We are now focusing on countries like Hungary, Ukraine, Azerbaijan, Kazakhstan, Romania and Syria that were earlier not considered export targets,” Parekh said.

Roadshows are being organised in these countries and their traders would be invited for the first time in the forthcoming Indian International Jewellery Show Signature Goa in February.

Another big brand in the business of yellow metal, PC Chandra Jewellers, however, is still not looking at other alternatives, but at the same time it is not ruling out chances of venturing into newer markets if the situation worsens further.

“We might look at other countries if the situation demands,” PC Chandra Jewellers deputy managing director Prosanto Chandra said.

The US is the biggest market for PC Chandra Jewellers, followed by Singapore and Turkey.

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