India is the largest market for silver jewellery and silverware, and it is growing exponentially since the last few years. The country’s silver jewellery exports for FY 2022-23 grew 8% year-on-year to $2.93 billion. We spoke to two prominent silver jewellery exporters to find out the reasons for the spurt in exports and what are the ways Indian manufacturers can tap other markets to keep up the momentum.
Silver holds a profound significance in Indian tradition and culture. It is an integral part of various significant events and rituals. From weddings to religious ceremonies, the exchange and gifting of silver items symbolise blessings, prosperity, and good fortune.
Despite its cultural significance, the volatility of silver prices can influence consumer behaviour. During periods of price uncertainty, individuals may choose to delay their silver-related purchases, hoping for more favourable market conditions before making their decisions. However, the enduring cultural significance of silver ensures that it remains a sought-after and cherished metal in India, irrespective of short-term price fluctuations.
According to silver exporters, some of the factors that have contributed to the recent surge in silver demand for exports in India are design and embracing technology. Krishna Goyal, Convener, Silver Panel Committee, GJEPC, attributes the growth to the recovery of the global economy from the pandemic, especially in the US, which is a major market for Indian silver jewellery. “. Post Covid-19, the disposable income available was reduced in hand of consumers and the innovation in designs gave them opportunity to fulfil the desire of personal adornment at affordable price.
Rahul Mehta, Managing Director, Silver Emporium, expounds, “Constant improvement in design, use of social media platforms to understand new trends, improvement in technology and better understanding of different types of plating … all these aspects have enabled the growth of exports from India. I also believe that Indians have a price advantage in global markets due to availability of skilled handcrafted workers.”
As for the projections for India’s silver export market in the next two years, and what factors are likely to influence its growth, Goyal mentioned that the Indian Government is aiming to reach the target of $70 billion by way of jewellery exports by 2025, and silver exports contribute around 6.75% of the total gems and Jewellery exports. “With the signings of the free trade agreements with countries like the UAE, Australia and many more that are in pipeline, it will help Indian products to be available at lower cost. However, the growth will also be influenced by the exchange rate fluctuations, the price volatility of silver, and the regulatory policies of the Government of India like the duty draw backs, etc.”
Outlining some of the challenges faced by Indian exporters in meeting the rising silver demand from international markets, Mehta commented, “We have all the available resources, skilled workforce to boost our share in the global export of silver jewellery and artefacts. Silver industry has one request from the government: to make duty-free silver available with nominated agencies at all times for exports so we can ship goods at international silver prices. We cannot keep growing if we are unable to meet this basic demand of importers across the world.
Vinayak Dhingra of Manmohan Exports, adds, “Indian exporters face several challenges in meeting the rising silver demand from international markets. The price volatility of silver, stringent quality standards, and certification requirements are significant hurdles. Currency exchange rate fluctuations can impact profitability, while competition from other exporting countries adds to the pressure. Trade barriers, regulatory compliance, and financing risks further complicate the process. Understanding changing market trends and preferences is essential, as well as navigating geopolitical and trade relations. Overcoming these challenges requires strategic planning, market research, and building strong business relationships, alongside government support and innovation to seize export opportunities.”
In order to grow silver exports in the jewellery and silverware segment, Goyal recommends, “Indian exporters should focus on creating innovative and trendy designs that cater to the preferences and tastes of different segments of customers across different regions and cultures. We must adopt new technologies to enhance the quality and efficiency of production and reduce wastage and ensure that our products comply with the international standards and norms of quality, safety, and sustainability, which is a big trend now. Increase participation in various trade fairs, exhibitions, buyer-seller meets, online platforms, etc., to showcase their products.”
Mehta adds that Indian silver exporters should go for study tours to fairs and important trading centres for silver jewellery. “This will guide them to develop specific products for their targeted export markets. Export promotion councils can play a very important role in curating such study tours.”