Kerala's one and only premier business event for the jewellery industry, 'Kerala Gem & Jewellery Show, KGJS 2013' is a prestigious trade platform that has been growing in importance over the last five years in the state of Kerala. The three-day event brings together India's finest jewellery manufacturers and technology service providers showcasing their latest products and designs to discerning business visitors from across India and outside.
As the sound of traditional drums, trumpets and cymbals ushers Amrita Mannil into the wedding hall, she’s adorned by four finely crafted necklaces, rings, 16 bangles, a glistening belt, dangling chandelier earrings and a stone-encrusted head piece to match the silk borders of her dress. She’s wearing about 800 grams (1.8 pounds) of gold.
Amid the music and the chanted prayers, a gold chain is placed around her neck as the 25-year-old advertising executive marries Vimal Mohan in a traditional Hindu ceremony attended by 500 friends and relatives in Kozhikode, about 180 kilometers (112 miles) from the city of Kochi in Kerala.
“Gold is an asset the girl carries,” 28-year-old Namitha Shyam, the bride’s older sister, said after last month’s ceremony. “The values, status and wealth of the family is represented by the gold the girl wears as she gets married. The more gold you wear, the more pride you have in your family.”
VIDEO: Gold-Laden Brides in India Defy Metal's Slump
The jewelry worn by the bride is typical and represents the cultural and social affinity Indians have had toward gold for centuries, making the country the world’s largest consumer last year. Demand in India and China helped bullion to climb by more than $1,000 an ounce since 2000 and helped to curb this year’s 23 percent rout.
At the same time, the resilience of Indian demand, and the fact the nation imports almost all the bullion it uses, poses a challenge for Prime Minister Manmohan Singh, as he seeks to trim a record current-account deficit and stem the rupee’s 12 percent slide this year.
Finance Minister Palaniappan Chidambaram responded by raising import taxes three times this year to curb consumption which represented about 20 percent of world demand in 2012.
Prices more than doubled in India since 2008 and reached a record in August. The increase gave pause to Ramesh Babu, the 61-year-old father of the bride, who bought Amrita less gold than he did for her sister’s wedding five years ago. He bought 100 sovereigns, each weighing 8 grams. “We are moderate,” said Babu. “There are people who give 300 to 400 sovereigns.”
Indians purchase gold at festivals and for marriages as part of the bridal trousseau and as gifts in the form of jewelry. Demand will be 900 to 1,000 metric tons this year, from 864.2 tons in 2012, the World Gold Council says.
Demand in India has helped curb this year’s slump in gold prices after some investors lost faith in the metal, a traditional store of value, as global inflation remained low. Bullion plunged 23 percent this year to $1,284 an ounce, poised for its first annual retreat since 2000. Prices in rupees have declined only 2 percent.
The slump in London prices erased about $64 billion from global exchange-traded products, data compiled by Bloomberg show. Central banks added to gold reserves the last two years even as they lost about $576 billion in value since bullion peaked at $1,921 an ounce in September 2011.
The $350 million PFR Gold Fund of billionaire John Paulson declined 62 percent this year through September. Investors cut their net long-position, or bets on price gains, on the Comex in New York by 37 percent in the week ended Nov. 12, the most since February, Commodity Futures Trading Commission data show.
For Indians, gold is not so much an investment as a cultural experience, said Pallavi Rao, assistant professor at the School of Communication, Manipal University, in south India.
“When you think about the great Indian wedding, you cannot think about it without all that gold jewelry,” [http://www.jewelsnext.com/
Mannil’s family spent more than six hours selecting the chains and necklaces Amrita wore at the wedding. An Indian bride without gold “is like rice without salt: bland,” said Sheela Ramesh, her mother, while fiddling with her own Thali, or gold wedding locket.“I got married in 1984, and the same tradition is being followed even now,” said Ramesh. “My parents gave me gold, and we give our daughters,” she said, as three other mothers, gathered at a pre-wedding ceremony to decorate Amrita’s hands with henna, nodded in agreement. “In our custom we wear only gold, no artificial jewelry.”
The insatiable appetite is good news for retailers such as Jewelsnext Media Pvt ltd, Gitanjali Gems Ltd. (GITG), Malabar Gold and Diamonds, Titan Industries Ltd. (TTAN), Tribhovandas Bhimji Zaveri Ltd. (TBZL) and Kalyan Jewellers Ltd. The stores represent 10 percent of the market estimated at about 1 trillion rupees ($15.9 billion), Edelweiss Securities Ltd. said in a report last month.