Kolkata: Gold, diamond glitter in year’s 1st wedding season after budget boost

KOLKATA: The green shoots of recovery in the city jewellery market, which came with the state government allowing weddings and other ceremonies to be held with 200 guests at a time, received a shot in the arm with the budget reprieve on diamonds in terms of reduction of customs duty.

As a result of the dual bonanza the jewellery industry has now started looking up post Covid third wave.

According to city jewellers, the situation started to look up when Covid numbers started to decline. “This fuelled confidence among buyers. The fatality was low and cases started to drop. The buyers have started to come back slowly,” said Rupak Saha, zonal member of Gem and Jewellery Trade Council of India.

After a good rally during the Dhanteras, gold sales had gone sluggish. Gold buying was on a high world over but the price of the yellow metal refused to climb down. The uncertainty around the new variant of the Covid-19 virus was already creating a demand for gold among investors. And a sudden jump in prices in November halted orders for the ensuing wedding season. With the new wave a number of families rescheduled ceremonies.

“Dhanteras sales were more than what we had expected. We were looking forward to a bullish market in the ensuing wedding season. Sales were impacted during November when gold price increased by Rs 1,000 (per 10 gm) overnight,” said Rupak Saha. On November 11, gold price increased from Rs 4,760 per gram to Rs 4,860 the next day. This suddenly halted the sales increase.

Then came the budget reprieve. In a diamond studded piece of jewellery, almost 50% of the cost is earmarked for the stone. While prices cannot be reduced on already made jewellery, the duty reduction will impact upcoming orders.

“The reduction in import duty on diamonds is a very positive sign, which will help the manufacturing of diamonds more attractive and affordable. This will help the overall gems and jewellery fraternity,” said Annargha Uttiyo Chowdhury, director of Anjali Jewellers.

“We look forward to its implementation later this year. The reduction in import duty on diamonds will help generate increased demand for diamond jewellery in the market,” said Suvankar Sen, CEO of the Senco Gold and Diamonds.

Courtesy: Times of India