Coloured Gemstone Mines to Market Meet - Solitaire Gemstone Mines to Market Meet 1st ICA...

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Transcript of Coloured Gemstone Mines to Market Meet - Solitaire Gemstone Mines to Market Meet 1st ICA...

  • The Gem and Jewellery Export Promotion Council (GJEPC) held the first ever International Coloured Gemstone Mines to Market conference in Jaipur over two days in November. More than twenty experts from the coloured gemstone pipeline from geology and mining to processing and marketing shared their views on issues of sustainability to maintain a steady supply of rough gemstones; mechanising mining activities to boost production; helping artisanal miners; beneficiating local inhabitants in the mining areas, and marketing these rare natural wonders innovatively. Some speakers even hinted at the prospect of investing in mines in Africa in joint partnership ventures with governments. The talks provided a stimulating exchange of ideas and opened up new avenues to grow trade. Shanoo Bijlani and Regan Luis report.

    AScriptingFutureColourful

    Coloured Gemstone Mines to Market Meet1st

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    COVERSTORY

    There was a time when the coloured gemstone business in India was much bigger than that of diamonds. In fact, Jaipur was the birthplace of the GJEPC, before the Council moved its headquarters to Mumbai. About 90% of the coloured gemstones find their way to Jaipur for being cut and polished. The total Indian exports of the coloured gemstones for the year 2009-10 stood at $314.5 million, but these figures pale in comparison to the diamond manufacturing industry, which exported goods worth $28.2 billion in the same year.

    Sensing a need to revitalise the coloured gemstone industry across the world, the GJEPC replicated the model of Mines to Market for Diamonds conference, for the coloured gemstones. The aim was to inject some fresh ideas and get new directions into the almost-stagnant state of this fragmented sector, which mostly depends on artisanal mining.

    Since time immemorial, India has been the key supplier of cut and polished tanzanite, emeralds and other gemstones, and employs over 2 lakh people in the industry. India has a large jewellery market and this has grown since the last decade as the economy has strengthened and there has been a sudden increase in the purchasing power of the people; in fact the domestic market is the most promising market today.

    The industry is also looking at avenues to invest in mines in partnership with governments abroad. GJEPC chairman Rajiv Jain said in his opening address at the conference, The whole idea of organising

    the Mines to Market conference was to inject some more vitality in the coloured stone industry as it was not showing the growth that it should show. Also, our share of jewellery should increase in comparison with other luxury goods. We were deliberating for a long time to take some actions by which we could increase the exports and business of coloured gemstones not only in India, but the industry across the globe. Until and unless all the stakeholders come under one roof, and do some brainstorming, we cannot move forward.

    More than 350 participants from Jaipur had pre-registered for the seminar, and a sizeable number of them were below the age of 40, informed Jain. In order to stem dropouts from this industry, it is essential that the second- generation manufacturers are roped in and involved. These seminars are intended to give them the confidence that this industry has the potential to grow and there is a lot to learn here, Jain said.

    Jain also stressed upon certain other measures such as pushing the free movement of goods especially for rough gemstones in India. The coloured gemstone industry is also actively considering the formation of a consortium for coloured gemstones along the lines of Diamond India Ltd., to bring more rough gems to India for processing.

    The GJEPC has been taking innovative steps such as this and the buyer-seller meets to promote and consolidate the industrys growth. Talks are on with the ministry of tourism, government of India, to promote Jaipur as the coloured gemstone destination for international tourists, Jain informed.

    Unfortunately, the coloured gemstone industry, particularly the mining sector, has remained largely unorganised, barring a few notable exceptions like Gemfields and some others. Jain remarked, This has affected the present industry to a large extent as we dont have organisations like the DTC to market the coloured gemstone industry. It is precisely in this context that we felt an acute need to hold a conference that would find a structured way to ICA

  • develop exploration, mining, processing and importantly, marketing of gemstones. Its only apt that the main sponsor of this Mines to Market conference is Gemfields, one of the most organised miners of gemstones in the world committed to following best business practices. This conference will be a forum of significance for the international coloured gemstone industry.

    Indias challengesSaurabh Chandra, additional secretary and financial advisor, ministry of commerce & industry, who inaugurated the conference, said that the conference aims at reinforcing Indias position as the global hub of coloured gemstones. The idea is to establish India as the one-stop shop for diamonds, gems and jewellery.

    Gem and jewellery exports constitute 17.4% of Indias total exports or about $252 billion. Exports of jewellery touched $43 billion in 2010-11 up from $29.4 billion in the previous year. For the period April-September 2011, jewellery exports touched $22.6 billion registering an increase of 23.1% vis--vis the same period in 2010. Sadly, exports of coloured gemstones amounted to only $171 million.

    There are a large number of challenges in the coloured gemstone industry that need to be overcome.

    Chandra stated that nearly 20% of Indias gem and jewellery exports go to

    the US and Europe. With the economic slowdown in these regions, new markets had to be developed. He suggested that exporters could develop international brands to achieve greater value additions. Formation of joint ventures with global retailing sourcing chains could be another way to increase their market share. To achieve this objective the industry could leverage on the India brand equity to fund the market access initiative and the market development scheme of the government. This should help establish a foothold in new markets, Chandra noted.

    At the same time, efforts are required to lower tariffs in some countries so that the entry barriers are reduced, Chandra commented.

    Another cause of concern is that sourcing of rough gemstones has remained erratic, and the inconsistency in supply and demand results in higher prices. Chandra revealed that the commerce ministry had held detailed discussions with the supplier countries such as Russia, Canada, Australia, South Africa, Namibia, Lesotho, Botswana, Angola, Azerbaijan, Armenia and Uzbekistan to resolve the issue.

    It is a win-win situation for both, as markets producing rough could use Indias skill in cutting and polishing and seek our assistance to establish industries there and to ensure that value addition takes place in the Indian gem industry, Chandra suggested, adding, In order to expand the

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    Saurabh Chandra

    Rajiv Jain

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    market size for gems and other industries, we have been currently in talks with countries like Russia to increase bilateral trade, and we aim to reach a target of $20 billion by 2015. This augurs well for the Indian gem market since Russia is a market of significant potential in the future.

    He informed that the gem and jewellery segment is also a focus area for the government. In the Foreign Trade Policy 2009-14, India aims to double its export of goods and services. The gems and jewellery sector has been identified as one of the thrust sectors along with others such as agriculture and handicrafts since they can contribute significantly to economy and employment.

    Steps have also been taken at the policy level to ensure that the gem and jewellery industry gets the highest publicity since it has significant potential in terms of growth

    in meeting worldwide consumer demand as well as contributing to Indias exports and national income.

    The master of ceremonies was Yianni Melas, the Cyprus-based jewellery designer, who recently launched his trademarked brand Philippe Alexander.

    All the eminent geologists and miners were of the view that the coloured gemstone industry should engage in best business practices and make business models more sustainable. They also spoke about beneficiating the local population by introducing a number of schools, cleaning up the environment and other measures.

    MININGInvest in minesMark Saul of Swala Gem Traders, and secretary general of the Tanzania Mineral Dealers Association, spoke about the

    mining situation in Africa. He was of the view that for sustainability, a steady supply of gems was needed. This, in turn, could stabilise prices.

    In order to sustain a steady supply of rough gems, Saul urged the stakeholders that this was the moment to invest in the mining industry in countries such as Zambia, Mozambique, and Tanzania. Work closely with the governments by looking at options like partnerships or collaborations; offer benefits to the local communities, he suggested.

    Prior to the recessionary year 2008, there were at least 15 different types of gemstones mined in Tanzania including tanzanite, rhodolites, spinel, red garnet, tsavorite, tourmalines, aquamarines, rubies, sapphires and more. After 2008, there was a serious drop in the production of stones in Tanzania. He quoted official figures ICA

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