G&J exports hit by China shutdown
Chow Tai Fook, the world’s biggest jewellery chain by revenue, has temporarily halted operations in about 80 per cent of its stores in mainland China.
Chennai: The coronavirus outbreak and the consequent closure of manufacturing units and jewellery stores in China as well as Hong Kong has added to the woes of gems and jewellery exports, which were already reeling under the pressure of slower global demand and credit crunch.
According to the Gems and Jewellery Export Promotion Council, off-take by China as well as Hong Kong has come down by 10 per cent since the outbreak. If the situation persists the impact could be higher and more widespread, finds the industry.
“Some of the jewellery units have been closed following the outbreak. Jewellery stores too are closed and the consumption has been hit across the country,’ said Colin Shah vice chairman, GJEPC.
Chow Tai Fook, the world’s biggest jewellery chain by revenue, has temporarily halted operations in about 80 per cent of its stores in mainland China. Chow Tai Fook has more than 3,600 outlets in mainland China. The remaining stores are also opened for lesser hours. It has also temporarily closed 40 stores across Hong Kong and Macau as fears over the possible spread of the novel coronavirus are keeping shoppers away from stores.
In January, the overall exports of gems and jewellery from India dipped 9.17 per cent to $2,966.42 million against $3,265.88 mn in January 2019.
China and Hong Kong are major buyers of cut and polished diamonds from India, accounting for around 30 per cent of the exports. Export of cut and polished diamonds have come down 5. 67 per cent in January and is down 16.80 per cent between April and January.
“The slowdown in China can spread to other markets as well and this is a major worry for the industry,’ said Shah. Chinese travellers are major buyers of diamond studded jewellery in the US market.
The industry has appealed to the government and the Reserve Bank of India to revise credit terms for exporters and importers in the gems and jewellery trade which has been badly affected by the Hong Kong protests last year and therecent novel coronavirus outbreak.
It has asked for leeway and time for credit facilities availed by exporters / importers for meeting their financial commitments and extension of tenor.