MBA 2013-15
IMITATION JEWELRY (7117) Industry Analysis
Akansha Kumari 4A Kumar Gaurav 22A Shainky Govil 44A
Table of Contents 1. Objective…………………………………………………… Objective……………………………………………………....……………………………3 ……………………………3 2. Research Methodology…………………………………… Methodology……………………………………....……………………………3 ……………………………3 a. Supply Side…………………………………………… Side……………………………………………....…………………………….3 …………………………….3 b. Demand Side………………………………………… Side…………………………………………....………...…………… ………...……………..……..3 3. Competitive Performance……………………………… Performance………………………………....…………………………… ...4 ……………………………...4 4. Why to buy imitation jewelry…………………………….. jewelry……………………………..………………………….. ………………………….....4 ...4 5. Indian Market Overview Overview …………………………………………………………. ………………………………………………………….…....6 6. Raw Material……………………… Material…………………………………………… …………………………..…………………… ……..……………………..…...7 ..…...7 7. Production Hubs In India.………………………………………………….…………...8 8. Important manufacturing hubs………………………………………..……………... hubs………………………………………..……………......8 ...8 9. Suppliers Present In India………………………………… India…………………………………....………………………… …………………………...9 ...9 10. Value Addition Chains………………………..….………… Chains………………………..….………………………………….… ……………………….…11 11. Process of production of imitation jewelry……..……….……………………………12 12. Costing of imitation jewelry………………………………………………………….. jewelry…………………………………………………………...13 .13 13. Workforce………………………………………………………………….………..…... Workforce………………………………………………………………….………..…...14 14 14. Imitation Jewelry Market……………………………………………………………… Market………………………………………………………………14 14 15. SWOT Analysis………………………………………………………………………. Analysis……………………………………………………………………….…15 16. The Road Ahead………………………………………………………………… Ahead…………………………………………………………………..…… ..15 ……..15 17. The Challenges………………………………………………………………………… Challenges…………………………………………………………………………..17 ..17 18. Export Destinations from India……………………………………………………… India………………………………………………………..19 ..19 19. Major Importers…………………………………………………………………… Importers……………………………………………………………………....… …..20 20. Demand Fact Sheet………………………………………………………………… Sheet…………………………………………………………………... ...…22 …22 21. Initiatives Taken……………………………………………… Taken………………………………………………... ...…………………… ……………………....22 ....22 22. Strategies to boost Exports……………………………………………… Exports………………………………………………... ...……… ………..…..25 23. Recommendations……………………………………………………………………… Recommendations………………………………………………………………………25 25
Objective The objective of the project is to evaluate the export competitiveness of commodity under chapter 61(HS code 7117) of Indian imitation jewelry sector. This study would look at the entire value and its exports from India.
1. Research Methodology – a. Supply Side To assess the supply-side factors of export competitiveness, a secondary research was conducted to find the supply-side bottlenecks that they are facing in India. The supplyside framework is based more on opinions than on data/ numbers b. Demand Side In order to evaluate the demand-side, the study has analyzed the competitive performance of Indian exports of the commodity (HS code 7117) in the primary market (US, UAE, Gemany, UAE, and France).
2.
Competitive Performance –
A product is said to be export-competitive if: 1. The growth rate in unit value of the product imported from India exceeds average growth rate in unit value of the product from all suppliers in a market, and 2. Its market share grows over the period 2008-2012. 3. To the extent market share is a function of quotas, market share of some county may decline over time only because their exports are constrained by quotas.
Definition: Can also be known as cubic zirconia jewelry, faux jewelry or costume jewelry. They are generally inexpensive versions of popular, more expensive brand name jewelry.
Why buy imitation jewelry “Jewelry is every woman’s best friend and yet, whether you agree or not her worst enemy. Why enemy? The answer is simple; the price tag just makes her shun away the thought of owning jewelry. But then this is the case with expensive jewelry set in gold or platinum, embedded with precious stones. After all anything genuine does come with a price tag. While real jewelry may not be affordable, an absolutely wallet friendly option is imitation jewelry. This is available in a wide range from what we call junk jewelry to the gold- coated jewelry. It is far cheaper than anything genuine. In fact the gold coated or what we also called gold plated jewelry looks so real that anyone would think you have paid a packet for it. “ Not only gold, but also even diamonds are available in its cheaper option called American Diamonds. These are actually pieces of glass that are polished and cut in a way to give the sheen and look of a diamond. American diamond jewelry cost less than half of what actually diamonds cost. Genuine jewelry has its limited wearabilty, which means that what you pick up may not go with every outfit you own. And because of its cost it is not possible to own a piece of jewelry to match up to your wardrobe. But with the option of imitation jewelry, you could possibly afford to own a piece that could match with every dress you have. The range of colors and styles span over a wide variety. In fact there are designers who specialize in imitation jewelry. Right from feathered earrings to ivory pendants, from glass bangles to beaded anklets, it is probably available. In fact using your imagination and artistic and craft skills you could create your own range of imitation jewelry at home with beads and strings. “
Indian Market Overview Indian jewelry business has undergone a drastic transformation over the years. Original diamond and gold jewelry has now made a way forward for artificial jewelry. The sky rocketing prices of the traditional jewelry whether it is gold, diamond or silver, have encouraged people to opt for affordable imitation jewelry. Indian Imitation jewelry market has witnessed tremendous growth in the past few years. In 2012, the market grew around 85% compared to the previous year. The imitation jewelry market was estimated to reach INR 98.5 Billion by the end of 2013 due to rising demand. Imitation jewelry such as fashion jewelry is very much prevalent, especially amongst the college going teenagers. Since the prices are cheap, they can get a wide variety and also
In future, the imitation jeweler market is expected to grow further with soaring gold and silver prices, rising consumer preference, availability of more innovative designs and variety etc. Considering these factors, the imitation jewelry market in India is anticipated to grow at a CAGR of around 23.5% during 2013-2017.
2011
2012
2013
2014f
2015f
2016f
2017f
Raw Materials These are a few of the raw materials that are used as inputs for the Imitation Jewelleries: 1. ZIRCON: Is a mineral occurring as prismatic crystals, typically brown but sometimes in translucent forms of gem quality. It consists of zirconium silicate and is the chief ore of zirconium. Zircon occurs in many colors, including red, pink, brown, yellow, hazel, or black. It can also be colorless. The color of zircons can sometimes be changed by heat treatment. Depending on the amount of heat applied, colorless, blue, or golden-yellow zircons can be made. Major procurement centers:
Domestic: Tamilnadu , Kerela , Odisha
International :China , Indonesia , Malaysia , Ukraine , Brazil , Australia , South Africa
2. AMERICAN DIAMONDS: is the cubic crystalline form of zirconium dioxide (ZrO 2). The synthesized material is hard, optically flawless and usually colorless, but may be made in a variety of different colors. It should not be confused with zircon, which is a zirconium silicate (ZrSiO 4). It is sometimes erroneously called "cubic zirconium".
competitor as a synthetic gemstone is the more recently cultivated material, synthetic moissanite. Major procurement centers:
Domestic: Panna mines , Rajasthan
International: China , Japan , USA , Germany
3. STAINLESS
In metallurgy, stainless
STEEL:
steel ,
also
known
as inox
steel or inox from French " inoxydable ", is a steel alloy with a minimum of
10.5%[1chromium content by mass. Stainless steel does not readily corrode, rust or stain with water as ordinary steel does, but despite the name it is not fully stain-proof, most notably under lowoxygen, high-salinity, or poor-circulation environments. There are different grades and surface finishes of stainless steel to suit the environment the alloy must endure. Stainless steel is used where both the properties of steel and resistance to corrosion are required
Domestic procurement : Rajkot, Jamashedpur, Hyderabad, Pune, New Delhi, Chennai
International: India is self sufficient in the production of stainless steel.
4. Cup Chains 5. Rondels
Procured mostly from SME’s located around
6. Metallic Balls
production houses.
7. Stones in settings
Production Hubs in India Imitation jewelry such as: Bangle, Bangles, Costume Jewelry (also called artificial jewelry, replica jewelry, junk jewelry, fake jewelry, or fallalery), Bracelets, Kada, Chain, Mangal Sutra, Mala, Necklace Set, Pendant Set, Anklet, Nose pin, Nose ring, Earring, Ring, hair accessories Manufacturer, Wholesaler, Supplier at: Rajkot, Gujarat, Mumbai, Maharashtra, Delhi, Moradabad, Sambhal, Jaipur, Kohima
Important manufacturing Hubs
New Delhi
Rajkot
Jaipur
Noida
Kolkata
Ahmedabad
Chennai
Hyderabad
Coimbatore
Bengaluru
Moradabad
Pune Surat The thing to be noted is that Imitation Jewelry market is flourishing in Tier 1 & Tier 2 cities but is yet to make its mark felt in lower wrung cities and towns.
Suppliers Present in India:
Address 8, PLATINUM PLAZA, OPP. INDIAN OIL PETROL PUMP, NR. JUDGE BUNGLOW ROAD, BODAKDEV, Ahmedabad - 380015, Gujarat, India
ISABELLE EXPORTS
Member duration 6 years
With an aim to stand tall on the expectations of patrons, we are engaged in providing them with attractive range of imitation jewelry. We are highly in demand for our quality assured products such as 3 Binder Case in Ring, 3 Ring Binder and 3 Ring Recipe Binder and more. Our Export Markets: Germany, Europe, China, Munich and Miami
Rhodolite Overseas – Member duration 5 years Established in the year 2012, we are a trusted business entity in the domain of exquisite collection of cnc machine cutting imitation jewelry bangles. Our dedication towards work has gained us enviable reputation in the market. Our collection gives a very appealing look and is in accordance to the latest market trends. Our product range comprises imitation jewels gold plated, imitation bangles, imitation necklace sets and checker imitation jewelry Address: 'GANDHI SMRUTI' 3, PEDACK ROAD, Rajkot - 360003, Gujarat, India
Shree
Parshavnath
Creations
(Fashion-Art)
(Estb
1890) – Member
9
years
We are acknowledged as a top manufacturer, supplier and exporter of the competitive domain of imitation jewelry. All these products are exclusively designed, keeping in mind the latest trends & varied needs of the clients. At the same time, it is affordable and exquisitely designed. Our wide range of bridal bangles includes brass bangles, metal bangles, glass bangles aluminum bangles, metal bangles and stone bangles Address: 99, Swadeshi Market, Sadar Bazar, Delhi - 110006, India
TRANSWORLD TRADING INC. – Member Duration 13 years Address 2994/2-A, STREET NO. 17, RANJIT NAGAR, New Delhi - 110008, India
With a mission to establish ourselves as a leading organization, we started off 22 years ago, and soon our Imitation Jewelry collection started receiving great appreciations from the clients. We have maintained excellent track record in both the domestic and international market. The wide assortment we are dealing in comprises antique wooden boxes, decorative antique pet urn boxes, handicrafts, wooden handicrafts, equestrian products, saddles, fashion jewelry and even more
ArihantTouch –Member 1 year Exporter, supplier, & trading comany offering wide range of american diamond neclace set diamond neclace set neclace set american diamond c bangles stylish diamond c bangles designer bangles american diamond endant set diamond endant sets, stylish cz necklace sets, diamond pendants, designer pendant sets, bridal jewellery, diamond kundan necklace set, kundal bridal set, fashionable pendant set, diamond stylish pendant set, American diamond czkada, American diamond Address : 110, Kakakua Bldg., 3rd Bhoiwada, Shop No.-3, Bhuleshwar, Mumbai 400002, Maharashtra, India
RoyalNx –Member 2 years Based in Mumbai, India, they are a manufacturer and trader of a wide range of imitation jewelry and jewelry stones.
Competitive Market Advantages:
Global export market Quality assured products Sophisticated infrastructure In house designing and quality checking team
Address : 61 - 63, SutarChawl, 1st Floor, Near Zaveri Bazar, Mumbai - 400002, Maharashtra, India FusionArts –Member 3 years Manufacturer, Exporter, Distributor, Supplier and Trader of Imitation Jeweleries,
Designer Necklace Sets, Designer Necklaces Set., Designer Net Patern Earring, Designer Pearl Necklace Set, Designer Pearl Studded Hair Brooch , Designer Pearl Studded Kada, Designer Pendant Address : 312/314, Abdul Rehman street, Opp. Crawford Market, Mumbai - 400003, Maharashtra, India Zorba Logistics Pvt. Ltd. imitation jewelery...Trader and Exporter of Fashion garments, dust woolen coat, fashion accessories, handicrafts, jute bags, imitation jewelery, spices, eatables, logistics Service Provider of Freight forwarding, import, exports, custom house agent, transportations, air freight Address : I S-23, Sej Plaza, 2nd Floor, Off. S.V.Road, Malad (West), Mumbai - 400067,
Maharashtra, India Shree Ambica Novelty Distributer and Supplier of Imitation jewelery-ring, bracelet Trader of Imitation jeweleryring...Distributer and Supplier of Imitation jewelery-ring, pendent, bangles, set, necklaces, bracelet Trader of Imitation jewelery-ring, pendent, bangles, set, necklaces, bracelet Address: No 1112/16, Toy Market, Pankore Naka, Ahmedabad - 380001, Gujarat, India
Value Adding Chain in Imitation Jewelry (Handicraft Industry) Identification of market opportunities
Prototype design and development / adaption and refinement
Test marketing
Upgrading equipping facilities
Securing inputs
Entrepreneurial hiring, training, managing
Production, quality control and packaging
Costing and pricing
Physical distribution
Export market development: Handicraft overview In the changing world scenario, craft products exported to various countries form a part of lifestyle products in international market. The impact is due to the changing consumer taste and trends. In view of this it is high time that the Indian handicraft industry went into the details of changing designs, patterns, product development, and requisite change in production facilities for a variety of materials, production techniques, and related expertise to achieve a leadership position in the fast growing competitiveness with other countries. The 6 million craft persons who are the backbones of Indian Handicraft Industry as provided with inherent skill, technique, traditional craftsmanship but that is quite sufficient for primary platform. However, in changing world market these craft persons need an institutional support, at their places i.e. craft pockets for value addition and for the edge with other competitors like China, Korea, Thailand etc. Imitation jewellery is largely made of brass, cast iron, nickel, plastic beads and stones, instead of precious metals and gems. It does not have much resale value and prices range between Rs 100 and Rs 30,000, the study said. India is the second largest manufacturer of imitation jewellery after China. Indian costume jewellery has a huge demand in the US, Europe, Canada, Australia and many Asian countries.
Process of Production of Imitation Jewelry
The process is essentially ambiguous and depends on the type of jewelry to be made. Some common steps for imitation jewelry are: Basic techniques for bending wire, attaching clasps and closing crimps. And also usage of the different types of stringing materials such as tiger tail and thread. Basic tools required to make jewelry are round rose pliers, chain nose pliers, crimp pliers, a wire cutter and bead board
There are many different types of beads including glass, semi-precious stone, crystal, silver, gold, metal and ceramic. Also use charms and various size chains to make jewelry. It is a good idea to consider the use of jewelry presentation boxes and pouches for the display and selling of your jewelry. Not only do they enhance the beauty of your jewelry pieces but they also help increase your sales. Not only would the box protect the jewelry piece, but it also allows your customer to present it as a gift.
Costing Of Imitation Jewelry Again as per the ambiguity in the manufacturing and raw material supply even the costing of this industry is very vague. Some of the common methods deployed for pricing imitation jewelry are: Simple jewellery pricing formula - Price = material costs x 3 + pro-rated hourly labour rate. For example the necklace made cost Rs. 5 in jewellery supplies and took 30 minutes to make. Using the formula Price = Rs. 5 material costs x 3 + Rs. 10 labour (30 minutes of labour equals half an hour. So half of Rs. 20 hourly labour rate equals Rs. 10 of labour on this necklace)
This gives you a selling price of Rs. 25. An additional step in using the jewellery pricing formula above is to take into account the following to adjust the resulting price: (a) What will your target market be prepared to pay; (b) How unique is the jewellery made; (c) What do shops charge for similar pieces?
Indian Custom Duty of Products HS-Code
Item Description
Basic Duty
CVD
SPL. CVD
71171100 Cuff-links and studs
10.00 %
6%
0%
71171910
10.00 %
6%
0%
71171920 German Silver Jewellery
10.00 %
6%
0%
71171990
10.00 %
6%
0%
71179010 Jewellery studded with imitation pearls 10.00 % or imitation or synthetic stones
6%
0%
71179090
6%
0%
Bangles
Other
Other
10.00 %
CVD – Countervailing Duties
Generally, imitation jewellery comes in four different varieties
Cubic Zirconia jewellery
Workforce Though imitation jewellery industry is unorganized, it provides employment to many people, say merchants. About 70 per cent of employees working in the industry are illiterate women and they work from home. India may leverage its traditional craft-skills, low-cost labour, and fabrication techniques in some of the jewellery products (such as processing of small-sized diamonds), and replicate such advantages in the production of other products, and thereby become a global player across the gems and jewellery segments.
Imitation Jewellery Market Imitation jewellery (HS 7117): The Asian and European countries dominated the export of imitation jewellery – Hong Kong, China, Austria and France. Major importers of artificial jewellery include USA, Germany, France, UK and Italy in 2007. Hong Kong was a major source country for all the major importers, followed by China and Austria.
India’s exorts under this roduct category amounted to US $ 117.46 million. Though India is also one of the major exporters of artificial jewellery, Ind ia’s roducts are mainly sourced by UK. Other major export destinations for India include: USA, UAE, Spain and Saudi Arabia; however, the volumes are insignificant as compared to the potential. India needs to target these markets through various strategies ( Cuff links & studs of base metal w/n plated with precious metal (HS 711711): Major importers of products under this category include: USA, UK, Japan, France, and Hong Kong; major source countries for products under this category include: Thailand, UK, Hong Kong, China, and Germany in 2007. Thailand served as a source country for all major importers of the world (Table 37). India’s exorts under this roduct grou amounted to US $ 2.58 million. Though India was not a major exporter under this category, India was a major source country for USA contributing 8.1% of the total imorts by the USA. In value terms India’s exort to USA was US $ 2.09 million a share of 81 % of India’s total exorts under this roduct grou.
SWOT ANALYSIS
Strength
Weakness
Excellent Innovation styles
Lack of skilled workers
Cheap Labour
Unorganised
Changing consumer preferences
Lack of high end technology
Value for money
Low penetration
Oppurtunitie s Product Diversification
Rising prices of Gold and Silver Young untapped Indian population Advent of online marketing
Threats Cheap imports from China Entry of MNC Online portals Lack of customer preference Big penny marketing by traditional jewellers
These are some of the key concerns that this industry faces in the wake of globalization and changing marketing landscape:
The jewelry industry in India adds a distinctive feature with high domestic and international demand. With rising gold and silver prices, imitation jewelry market has been witnessing significant growth over the past few years. Moreover, Indian imitation jewelry making is emerging as the next big market which has been pre-dominantly driven by its indigenous designs and local demand. In addition, the perspective of manufacturers, wholesalers, traders and retailers of the imitation jewelry industry holds much more capability than the conventional offering. The industry dynamics and consumer behavior atterns have made India the world’s second-largest manufacturer of imitation jewelry after China. Rajasthan, Uttar Pradesh, West Bengal, Bihar and Madhya Pradesh are some of the important states known for such products. Further, with the entry of large organized players, the market will become more competitive and people have more choices among branded and quality products. Beside, Indian imitation jewelry has a huge potential for exports and enjoys huge demand in the foreign markets. The demand is also rising in many Asian countries which will help further the industry to accelerate in the near future. However, there are also certain challenges such as cheap imports from China, costly labor, etc. which needs to be addressed as these can affect the growth of the industry. Considering the above factors, the future of Indian imitation jewelry market seems quite bright
The Challenges Ahead Market Driving Factors Here we discuss in detail the propellants for the rising market of Imitation jewellery in detail: • High Demand: The demand for imitation jewellery has surged by over 85% in the last one year. People, especially women have adopted better standards of grooming after being influenced by daily soaps. They ape the jewellery and the costumes which are worn by the television stars. Moreover with the rise in standard of living and disposable income customers undoubtedly prefer to go in for branded products. • Consumer preferences: The changing outlook of people regarding jewellery as a daily wear commodity rather than an asset for life has made imitation jewellery more popular. • Variety and Affordability: Due to affordable range of the artificial jewellery, it is much easier to make a collection for regular as well as formal occasions. Generally working women prefer to change their jewllery (earrings, neck-pieces, rings etc) according to their dresses. • Drastic hike in gold and silver price - With the prices of gold raising sharply, the popularity of imitation jewellery has further increased. • Security purpose: Imitation jewellery is safer to wear as compared to the authentic jewellery. In the pre-sent day when theft and crime is increasing in society, customers feel more secure wearing fake jewellery. • Excellent innovative designs: Imitation jewellery comes with unlimited and exquisite designs which can be easily purchased. • Value for money: Traditional jewellery cannot be changed according to latest fashion. However imita-tion jewellery can be worn and discarded according to latest trends due to their low cost benefit. • Lack of gender bias: In the past jewellery was exclusively for the fairer sex but in the recent times men have also initiated an interest in adorning themselves with this. One can easily come across specially de-signed fashion jewellery like bracelets, rings, chains, pendants, earrings for the males also. • Cheap Imports from China: Imitation jewellery from China is flooding the Indian market and imports from China have already catured 30% of the country’s domestic maret.
worth about INR 1.3 Billion in 2011-12. During the period April-September 2012, 0.6 bn worth of finished imitation jewellery was imported from China. However, this figure underestimates the actual level of imports, which are believed to be 10 times higher.
Accessibility
Besides metros and tier one cities, accessibility of standardized imitation jewellery is a big issue, and therefore, a significant portion of the consumer segment is underserved.
Highly Unorganized
Indian Imitation jewellery market is highly unorganized with the organized market is nearly three-fourth of unorganized sector. In addition, the number of organized players is also less in the sector India’s gems and jewellery industry is highly unorganied and fragmented with more than 90% of the players having family owned businesses. According to a FICCI study, the gold processing industry has around 15,000 players, with only around 80 units having revenues of over US $ 5 million. India is also home to around 450,000 goldsmiths, over 100,000 gold jewellers, about 6,000 diamond-processing players, and 8,000 diamond jewellers. The unorganized and small-scale nature of the sector hampers the ability of Indian gems and jewellery industry to innovate, upgrade technologies, and emerge as a world-class supplier.
Lack of Customer Awareness
The customers need to be educated on the basic artificial jewellery care to maintain the quality or the olish of the roduct. “Also Indian customers need to be informed that certain regions in India have humid weather which adversely affects the shine and the plating of the product.
Costly Labour
For the artificial jewellery industry labor is very expensive. In addition, there is a lot of attrition due to which the manufacturers have to continuously increase the wages of the labor, which adds to the overhead costs.
Low Quality Jewellery
In case of imitation jewellery, same designs are available in low quality material at low cost which is affecting the growth of the market.
Export Destinations from India The following table represents the top ten major export destination of Imitation jewelry from India: (all data in US$ thousands) Importers
2008
2009
2010
2011
2012
World Afghanistan United States of America United Arab Emirates United Kingdom Spain Saudi Arabia Thailand Malaysia Iran (Islamic Republic of) Sri Lanka
157362 623 27777
176373 2095 27938
162907 1494 33221
324817 41847 44861
348983 67213 51448
16027
30641
13582
88055
47557
34601
35788
28171
34380
26721
8750 6487 270 1256 623
11046 5113 108 1330 494
11118 7192 28 1854 778
14469 11819 68 2129 3801
16618 12472 11418 7865 7476
357
289
467
1477
6207
We can analysis the change in exporting trend by observing the following graph:
A global map wise representation of Indian Imitation jewelry presence:
Major importers of India Here is a list of major countries from which India imports Imitation jewelry:
E20
World China Hong Kong, China Austria Germany United Kingdom Philippines Italy France Thailand United States of America
Imported value in 2007 9216 3751 1055
Imported value in 2008 10833 4948 1266
Imported value in 2009 12064 6981 1270
Imported value in 2010 16373 11165 719
Imported value in 2011 24153 14991 1648
2356 616 84
928 732 259
467 355 146
1258 380 437
1515 904 749
0 107 146 323 108
3 156 528 225 124
3 164 344 282 405
65 175 305 328 306
632 512 496 460 451
The graph below shows the import footprint of India.
Demand Fact Sheet
Demand for imitation jewelry has suddenly gone up by over 85% due to drastic hike in gold and silver price and increased interest in gems & stones during wedding and current festive season as per the quick survey undertaken by ASSOCHAM-Social Development Foundation (ASDF).
The exports have seen a rise of 35%, reveals the Associated Chamber of Commerce and Industry of India (ASSOCHAM) survey.
The imitation jewelry market is about Rs 8,000 crore (growing at the CAGR of 20% y-o-y) in India and expected to touch Rs 15,000 crore by 2015.
Consumers between the age group of 18 to 35 amount for about 78% of the total demand.
Major demand centers in India are: Delhi, Mumbai, Kolkata, Gurgaon, Lucknow, Bangalore.
Promotional Schemes to boost the sector The government has launched various promotional schemes under its FTP to help the SME’s and SMSE’s to incentivie the imort and exort of sunrise and hitherto. Some of these schemes are :
1)Focus Market Scheme : Exporters of all products to notified countries shall be entitled for Duty Credit scrip equivalent to 2.5% of FOB value of exports for each licensing year commencing from 1st
April, 2006.However New additional Markets notified in
Appendix 37C of HBP v1 shall be
entitled for Duty Credit scrip on exports w.e.f
1.4.2008.Exports made by EOUs / EHTPs / BTPs who do not avail direct tax benefits / exemption shall be eligible.
2) ASIDE : Jems and jewellery unites located in SEZ can now receive semi precious metals prior to export or after export equivalent to the value of jewellery exported .
Wastage for subcontracting/exchange of gems and semi precious stones between SEZ and DTA is allowed
3)Focus Product Scheme : Under this scheme the exemption
re import duty for
imitation jewellery sent to USA for exhibition has been increased from 60 to 90 days . Duty free export has been allowed for Canada .
4) Market access scheme : Financial assistance under the existing Scheme is provided to
exort or trade romotion organisations / exorters etc. for enhancing India’s exorts through accessing new markets or through increasing the share in the existing markets. Financial assistance is also provided under the scheme for various activities such as participation in trade fairs abroad, opening of showrooms and warehouses etc.
Initiatives Taken
Government Initiatives: The strategy to achieve the vision for imitation jewellery is as follows:
Product development and production: The product development strategy focuses on developing demand-driven products based on market requirements. The strategy builds upon already existing skills and cultural heritage, coupled with inputs from new designers, training in core business areas, horizontal and vertical linkages, ensuring access to raw materials and the fostering of entrepreneurship. The core of this strategy lies in the successful implementation of the design development, compliance, quality control and capacity building components that have been introduced in the schemes. Marketing and compliance: The overall marketing strategy focuses on the steps needed to enhance the marketing efforts of the sector to capture a larger market share, and to seize the opportunities associated with the expanding tourism and corporate investments being made. One of the key areas entwined at each step in this strategy are addressing the compliance issues, so that the products are acceptable internationally. The marketing strategy focuses on identification of the most appropriate market niches, ensuring quality and standardization of products, ensuring proper market access, branding, and marketing of the products efficiently. Sales of imitation jewellery continue to be confronted by obstacles in meeting the quantity, quality, and cost demands of different segments of the market. For producers to be able to take advantage of new economic opportunities and capture new market segments they need assistance in
expanding their production capacity, in upgrading the quality of their products to the standards demanded by buyers, and in overcoming the many obstacles they face in meeting the requirements of the targeted markets.
Infrastructure Development: This strategy seeks to respond to the main challenge faced in the availability of infrastructure and latest technologies in the sector and suggests solutions to these challenges by ensured focused interventions. A new scheme of ‘Infrastructure and Technology Develoment’ will be critical in filling the institutional gaps in the sector. Livelihood and working environment: The strategy for livelihood and working environment bases itself on providing social security to the artisans and their families. It also makes provisions for financial/ policy support and the necessary regulatory framework that fosters the development of viable entities which enable artisans micro enterprises (individually and collectively). Provisions have also been made for supply of tools and technologies, designs and marketing at the grass root level through the cluster approach.
Export Initiatives
three-day fair, organised by the Export Promotion Council for Handicrafts (EPCH), would be inaugurated by Textiles Minister K Sambasiva Rao. The objective of the fair is to increase the country's share in the USD 16.3 billion global fashion jewellery market.
A
The council has been organising IFJAS on an annual basis and the export fortunes of this segment have got a significant boost. The year-on-year growth of fashion jewellery alone over the last three years has been a noticeable factor. At Indian Fashion Jewellery and Accessories Fair, the buyers will have the opportunity to discover the finest in the Indian craftsmanship and artistic finish in perfect harmony with modern designs, contemporary colours and new product development under one roof, the release said. The country's fashion jewellery and accessories exports increased to Rs 2,007 crore in 2012-13 from Rs 1,237 crore in th previous fiscal.
Other Steps Taken
The Gems and Jewelry Export Promotion Council (GJEPC) and the Indian Diamond Institute (IDI) are to set up common facility centers in Surat and 12 other diamondproducing places in the state.
No import duty on rough diamonds
Government has sanctioned 300 cr rupees to set up 12 Indian Diamond Institute
IDI will launch some of the key courses such as diamond grading, computerized diamond planning, jewelry casting and manufacturing, jewelry model making, gold assaying and refining, advanced jewelry designing, jewelry model making, jewelry business management etc
Duty free import entitlement of commercial samples shall be Rs. 300,000
Duty free re-import entitlement for rejected jewelry shall be 2% of FOB value of exports
Imitation Jewelry Manufacturers Association (IJMA) and New Media Communication collaborates to host India's first ever interactive 'Fashion Jewelry and Accessories Show'
Private Initiatives: Imitation Jewelry Association of India Established in 1986, Imitation Jewelry Manufacturers Association (IJMA) is a non-profit organization dedicated to the growth and progress of the imitation jewelry industry of India. It's single, virtuous motives is to promote the Indian imitation jewelry market through events,
exhibition and making presentation to the government on the various issues faced by the industry, and to promote trading. With a little over 1500 members under its wings, the role of IJMA involves highlighting the importance of global trading and encouraging manufacturers to compete with international markets through various initiatives - "Fashion Jewelry and Accessories Show" (FJAS).
The Gem & Jewelry Export Promotion Council Established in 1966, the GJEPC has over the years effectively molded the scattered efforts of individual exporters to make the Gem and Jewelry sector a owerful engine driving India’s export-led growth. With more than 5,300 members spread all over the country, the Council is primarily involved in introducing the Indian Gem & Jewelry products to the international market and leverage their international relationships to promote exports. To achieve this, the Council provides market information to its members regarding foreign trade enquiries, trade and tariff regulations, rates of import duties, and information about jewelry fairs and exhibitions. This apex body of the Gem & Jewelry Industry is continuously working towards creating and retaining a pool of artisans, designers that are trained as per international standards so as to consolidate the Indian jewelry industry and establish it as a prominent global player in the jewelry segment.
Strategies to boost exports Export to France (and other European countries): Existing and potential trade between India and France in 2012
Product: 7117 Imitation jewellery Sources: ITC calculations based on UN COMTRADE statistics India's exports have been reported by India France's imports have been reported by France
India's exports to France
Value Produc
Product
t Code
Label
in 2012, USD thous and
711790
Imitation 4,002 jewellery nes
Annual growth in
Share
value in
France's imports from world
India's exports to world
Equivalen
Annual
Annual
t
growth
growth
ad
valorem
between
India's
tariff
2008-
exports applied
2012, %, , %
by France
p.a.
to India
Value in 2012, USD thousand
in value between 20082012, %,
Share in
Value in
world
2012,
imports
USD
,%
thousand
p.a.
Indicative potential
in value Share
in
between world 2008-
trade, USD thousand
exports, %
2012, %, p.a.
-1
1.7
10
131,213
6
4.9
232,048
23
13.2
127,211
-4
1.9
10
465,457
6
8.3
116,457
28
2.9
114,300
Imitation jewellery nes 711719 2,157 of base metal whether
o
not platd w
prec metal Imitation jewellery cuff711711 links&stud of 24 base
5
18
10
7,413
9
4.2
477
-28
0.3
metal
w/n platd w prec met
France’s total imorted value in 2012 for imitation jewellery is 604083 USD thousand. India contributed only 6183 thousand USD out of the total imports by France. From the above table, India’s exort to France has witnessed a negative growth rate of -1 %, -4% and 18% in the period 2008-12 in products 711790, 711719 and 711711 respectively. But the overall increase in imports of France is 6%, 6% and 9% in these products. Hence, there is an opportunity to increase trade with France and increase exports of imitation jewellery from India. European region is the biggest trade market for India, therefore total ad valorem equivalent tariff in the European region is very low as seen in the below table.
Importing country
Year
No. of corresponding national tariff lines
India's export(USD Thousand)
Total ad valorem equivalent tariff
France
2013
4
8,851
10%
Belgium
2013
4
1,995
10%
Germany
2013
4
8,431
10%
Greece
2013
4
961
10%
Italy
2013
4
5,669
10%
There is a huge potential to increase trade with France and its neighboring countries.
Recommendations
The growing markets to be focused: The US is the largest importer, while the UK continues to be the second largest buyer. EPCH Chairman Lekhraj Maheshwari says that this sector has tremendous potential to expand further,”
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Anti-Dumping Intervention by Government: A growing concern voiced by the traders is that illegal import of imitation jewellery has increased from China, thereby hurting not only the industry. "Due to dumping from China, Indian manufacturers have lost almost 25-30 per cent business. We must stop it, otherwise it will inflict major damage to the industry," said Nagendra Mehta, secretary of Imitation Jewellery Manufacturers Association of India (IJMA).
The domestic market is not doing well due to higher cost of production and overall inflation, which restricts the buying of imitation jewellery. Factor such as higher inflation is hurting the industry and should be dealt with .
Better branding of the Indian Imitation Jewelry giving it better credibility and equity should be done. Training for increased efficiency and quality can be provided to the handicraft industry.
References: http://www.trademap.org/ http://commerce.nic.in/ http://www.icrier.org/ http://www.aepcindia.com/ http://dgft.gov.in/ https://wits.worldbank.org/ http://data.gov.in/ http://www.unido.org / http://www.cci.in/ http://www.unescap.org/
