With the Indian government cracking down on gold, the metal’s poor cousin, silver, has shot into the limelight. Silver jewellery exports are expected to lead this fiscal year, given the geographical expansion into the markets of CIS (Commonwealth Independent States) and eastern Europe, both of which have benefited silver jewellery.
Silver exports are likely to jump 30% this financial year in India, against $797 million a year ago. In December alone, provisional exports of silver jewellery touched $73.85 million.
According to provisional data from the Gems and Jewellery Export Promotion Council, exports of silver jewellery during April to December 2012, jumped 24.68% in Rupee terms.
Shipments of gems and jewellery constituted 14% of India’s total exports. Gems and jewellery exports too are expected to rise 15% against $38.28 billion of overseas shipments in the previous year, the council has said.
With the US and European market favouring white metal jewellery over gold items, silver jewellery pieces made in India are a big hit with the Westerners.
As an official of the council pointed out, India’s silver jewellery exports for FY12 stood at $691 million (Rs 36 billion) against $482 million (Rs 25 billion) in FY11.
“During 2011-12, silver jewellery exports grew 44% compared to gold jewellery exports growth of 30%. We will have to wait and see what the next two months bring in for silver retailers,” the official said.
Manubhai Shroff of the Bombay Bullion Association added, “The Indian government is presently cracking down on the people’s ability to buy gold through regulations and taxes. Given the insatiable appetite for the precious metal, people will naturally gravitate towards gold after buying silver items for some time.”
But, he added that the demand for silver is expected to go up in India as well. Imports, however, may slip to between 3,500 tonne and 4,000 tonne from last year’s 4,800 tonne.