Opportunity for entrepreneurs as survey suggests innovation key for India's jewelry sector
The Gems and Jewelry sector in India needs attention of both government and industry members to drive innovations in terms of new designs, processes and skill development of work force to sustain in global markets, says a survey.
Consumer preferences have rapidly changed with the advent of globalization and demand for new and innovative designs has increased rapidly. In such a scenario, it is high time that Indian manufacturers adopt new methods and engage in research, according to the joint study of Assocham and TARI.
The Associated Chambers of Commerce and Industry of India (Assocham) and Thought Arbitrage Research Institute (TARI) survey also calls for overhauling of this "unorganized sector" which constitutes around 80 per cent of domestic market. "Due to westernisation of lifestyles, Indian consumers are demanding new designs and varieties in jeweler, and branded jewelers, who are around 15-20 per cent, are able to fulfill their changing demands better than the local unorganised players," it said.
"Consumer demand is shifting from unbranded to branded jewelry globally. It has jumped to 20 per cent of total demand in 2011 from just 10 per cent in 2003, and it is expected to reach 30 per cent by the end of 2020," it added. As unorganised players constitute a majority in the industry, India should focus on building their brand in the global market to meet the growing international demand of branded jewelry, the survey suggested.
Pointing out the importance of innovation (in designs), it said, "In order to fulfill the changing requirements, innovations are essential. Though family-owned players are proficient in traditional designs, there is lack of design-led innovations. This could be a limiting factor in meeting global and domestic demand".
It further said that "traditional trading and manufacturing have failed to provide any meaningful results for brands and retailers. Now, the industry needs modern methods and new market techniques". India exported gold jewelry worth USD 8 billion in 2013-14 and estimates to reach USD 40 billion by 2020 according to the World Gold Council, stated the survey.
As per the survey, overall exports from the (gems and jewelry sector) in India during the first 6 months of 2015-16 stood at USD 19.22 billion. The Indian Gems and Jewelry industry is one of the largest in the world with a share of 29 per cent in global jewelry consumption, it said, adding as per the figures of 2012-13, it (the industry) recorded a total market size of Rs 4,63,000 crore with domestic consumption standing at Rs 2,51,000 crore and exports stood at Rs 2,12,800 crore.
On the skill development front, the survey urged the industry to shed their age-old methods. It said the industry provides employment to around 46 lakh people. It is expected that the work force may rise to more than 82 lakhs by 2020, adding over 35 lakh new jobs.
"The high growth rate of this industry indicates the potentially high demand for skilled manpower in future. In such a scenario, the inherent skills in gold-smith families and on-the-job training may not be sufficient, especially when the need is to modernize so as to beat global competition," it pointed.
It also pointed out that "availability of trainers is also a major challenge in skill development. Trainers are typically skilled workers with 10-15 years of experience. They may be excellent workers themselves, but they lack the ability to teach and impart knowledge".
"The industry needs systematic and collective investments in skill development through increased training and manpower development programs. Industry leaders need to come together to set up training institutes. Government can also create national centers of excellence for this purpose," the survey suggested.
Image Credit : Shutterstock
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