Mumbai: India has surpassed Italy and is now officially the largest gold jewellery producer in the world. Confirming the development, Federazione Nazionale Orafi Gioiellieri Fabbricanti Aderente a Confindustria or Federorafi which is the federation of Italian jewellers said that India has relegated Italy to second place in gold jewellery production.
In an interview to TOI, Federorafi said India surpassed Italy in gold jewellery production due to “competitive production costs, better access to international markets due to lower customs tariffs, good product quality and a huge internal market”, which they say is not accessible to Italian/European goods due to high tariffs and due to administrative barriers.
According to data released by the GFM precious metal consultancy, GFMS Limited, India with gold jewellery production of 539 tons in 2005 was numero uno followed by Italy with 228 tons. The third spot went to China with 198 tons and Turkey was fourth with 197 tons. If scrap gold is included as part of production, India also emerged as number one.
Federorafi said that Italy lost out due to high labour costs, absence of trade reciprocity from other countries, towards non Organisation for Economic Co-operation and Development countries (India, China and South America amongst others), high rate of exchange of the euro compared to other currencies and difficulty in checking the distribution of goods.
Commending improving standards of Indian gold jewellery design, Federorafi said Indian jewellery designs had already reached high standards and were recognisable the world over. Italian gold jewellery has a reputation of producing sophisticated designs and for many years floral designs of Indian jewellery did not attract too many international customers. But that is now slowly changing and Indian gold jewellery designers are making a name for themselves.
Federorafi further added that unless there were sharp changes in the gold price and in the euro/$ exchange rate, Italian gold jewellery was unlikely to regain at least a part of the market share that it has lost in the last few years.