India’s Gem & Jewellery Export Promotion Council (GJEPC) is reporting a 10% decline in bank finance to India’s gem and jewelry sector, according to Gem Konnect. GJEPC estimates that the decline will negatively impact exports from the country by the same percentage.
According to GJEPC, exports of gems and jewelry fell 8.84% year-on-year from April to June 2018 to $10.1 billion.
GJEPC Chairman Pramod Agrawal said: “The Council is making all efforts to self-regulate and instill confidence amongst key stakeholders through a slew of reforms. However, the industry is witnessing a crisis of sorts as the banks have curtailed lending to the traders and are demanding collateral security and extensive documentation. In such a situation, the gem and jewellery industry, which is a $41 billion export industry, will see a gradual decline in FY 2018-19 […]”.
GJEPC Vice Chairman Colin Shah added that “banks continue to insist that all customer invoices should be routed through a bank. This is seriously hampering cash flow on a daily basis. Banks have also taken away all benefits on assessment fees due to which the cost of finance has gone up”.
