Dubai: After the UAE-India CEPA sign-off, first came the mid-sized Indian jewellery retailers for a first-time appearance in this market.
Now, India’s diamond and gemstone traders are following the same paths – but with one crucial difference. Their business doesn’t get any import duty waiver under CEPA.
Nothing surprising there ‘because the UAE always allowed loose stones and bullion to be brought in at 0 per cent duty,” said Sabyasachi Ray, Executive Director at India’s Gems & Jewellery Export Promotional Council. “Where we see advantages to build on is with coloured gemstones – we have already come a long way on diamonds.
“Dubai and DMCC are now at the heart of the global trade in rough and polished diamonds. India’s traders are already active here. We are trying to find out how to do the same with coloured stones.”
This is where the rubies, emeralds and sapphires come in. The Indian companies could choose two different tacks.
In the first, they could supply the increasing number of Indian jewellery retailers who are setting up shop in the UAE and who will require part of their sourcing of stones from the UAE itself. According to gold industry sources, these companies would ship part of their jewellery collections from India – at 0 per cent import duty - and use designers and manufacturers in the UAE to do the rest. Either way works out to be a duty advantage for them.
- UAE-India’s planned ‘green corridor’ will fuel smoother customs process, higher trade flows under CEPA
- Watch: Under CEPA, UAE’s ‘window to the world’ concept delivering results for Indian businesses
- After CEPA gains, UAE-India move closer to cutting a deal on dirham-rupee trade
- Indian gem, jewellery trade body launches 365-day exhibition in Dubai
In the second scenario, India’s gemstone traders will get the same sort of attention in major auctions conducted through DMCC by the big international firms, said Ray. Again, in an industry that’s built on who knows who through the decades, gemstone dealers could get the same sort of attention in auctions that their peers in the diamond trade do.
“There are big gemstone mining companies setting up large tenders, and what we can see is that the volume of such trades through Dubai is gradually replacing other legacy hubs such as Singapore,” said Ray. “So, anything that works to Dubai’s advantage in the precious stones trade can be leveraged by India’s businesses.”
Offering a taste of India – in jewellery
The Indian grouping is offering a sort of taster for the market – and the potential clients and deals it may hold. For the first time, an India Jewellery Exposition Centre will showcase what the market could offer the UAE in this category. The year-long event will allow small and mid-sized Indian firms in the business to put up what they can offer. Through the participation, the intent would be to drum potential contacts that could translate into new business.
“These businesses would have found it difficult to make those connections on their own,” said Ray. “What the exhibition does is help them save on costs and yet make those business ties possible.”
If all that happens, India’s gemstone trade will have the same sparkle that its diamonds do.