China’s zero-Covid policy hits India’s diamond exports

The China lockdown and Beijing’s zero-Covid policy have started to impact India’s exports of cut and polished diamonds, which fell for the first time this fiscal year in July.

Exports of these stones fell 13.45% from a year earlier to $1,933.32 million in July, as demand was muted from China, the second largest buyer of India’s cut and polished diamonds after the US.

Talking to ET, Vipul Shah, the newly elected chairman of the Gem & Jewellery Export Promotion Council, said: “Unless normalcy returns in China, the exports of cut and polished diamonds from India to China will not see an uptick. The same trend has continued in August too.”

The Chinese government on last Tuesday put millions of people into lockdown again, after several areas surrounding the capital Beijing reported a surge in Covid-19 infections. It imposed the lockdown despite the country facing economic hurdles.

The Chinese lockdown is impacting exports of diamonds to the Far East countries as well.

This year, the Jewellery & Gem World show has been shifted from Hong Kong to Singapore as there are very little Covid restrictions for tourists in Singapore, Shah said. The show is slated to take place in September where all international buyers will come. Singapore is currently more accessible to overseas buyers and exhibitors unlike Hong Kong, which still subjects travellers to a seven-day compulsory quarantine in a designated hotel. In Singapore, fully vaccinated visitors do not need to undergo quarantine or tests.

“China is a hub where international buyers come. But due to their zero-Covid policy and lockdown, hardly any international buyers are coming to China. Hong Kong too is stringent about Covid. Therefore, we are hoping that the meet in Singapore will result in exports of diamonds to go up,” Shah said.

While shipments of cut and polished diamonds fell, exports of plain gold and studded jewellery increased in July, by 6.54% to $740.04 million. The main market for gold and studded jewellery is Middle East.

Courtesy: Economic Times