India takes a shine to silver
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A shopkeeper displays silver jewellery at a shop in Jammu. The
silver jewellery industry is made up of high-end fashion
jewellery, also called sterling jewellery accounts for about 20
to 30 per cent. REUTERS
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Rapid economic growth over the last few years has created a thriving
60 million-strong urban middle class increasingly willing to splurge for
pleasure.
As a result demand for fashion jewellery in affordable silver —
priced as low as $1 and up to $100 — is rising sharply in a market where
purchases were traditionally in gold and for most were an investment as
much as a style statement. Buying gold would set you back ten times as
much. Silver prices currently trade at around $11.8 a troy ounce, while
spot gold stands at around $665 a troy ounce.
Though there is no accurate estimate of the size of India’s silver
jewellery industry, some manufacturers and analysts estimate it at $3-$4
billion and add that this year it could grow by between 5-15 per cent.
“Nowadays, people are spending on swanky mobile phones to computers,”
said Jaipur-based jeweller Pramod Derewala, who had focused on exporting
silver but is now looking closer to home.
“Silver jewellery is another fashion accessory, which can be worn
comfortably to work or at home,” he says.
Ruby-centred earrings, ankle bracelets with tiny bells and
belly-button rings vie for attention as customers of all ages throng
silver sellers. Silver bangles as thick as a thumb, heavy plates and
coins have always been popular in India’s villages as a safe way to save
for a rainy day, but gold reigned in the richer cities.
Traders say a new found love for all things silver is unlikely to cut
into demand for gold, which still maintains its investment allure for
the more cautious and carries that extra cachet.
India imports 750-800 tonnes of gold a year, about a fifth of global
output, and 60 per cent of that is used for jewellery. REUTERS |
