NEW DELHI: India might start exporting jewellery made from precious metals and stones to Pakistan soon, newspaper reports said.
Despite having enormous opportunities for bilateral trade between the two Asian neighbours with similarities in culture, ethnicity and choices, the jewellery trade between Pakistan and India is currently a mere $15 million annually. Since there is no direct access to each other’s markets, trade between the two countries takes place through secondary markets of Dubai, Sri Lanka and other Asian countries.
India is one of the world's largest jewellery exporter of the world. Its exports earned India $45 billion during fiscal year 2012.
A 12-member Indian delegation, led by vice chairman of Gems and Jewellery Export Promotion Council (GJEPC) Sanjay Kothari, visited Pakistan between June 7-12 and met many traders and retailers to explore potential for jewellery exports.
The team also met Prime Minister Yousaf Raza Gilani and discussed the possibility of growth in jewellery trade business. According to Kothari, Gilani agreed to look into tax and visa problems faced by the two countries to promote easy access to the markets.
"We can tentatively say that the direct jewellery export to Pakistan may commence in a couple of months," said Kothari.
While Pakistan would be a new destination for India's jewellery exports where Indian cuts and designs are widely accepted, import of classic colour gemstones by India would become easier.
Pakistan's jewellery market is estimated at $12 billion while India's annual jewellery exports stands at around $32-33 billion.
Direct access to Pakistan's jewellery markets would partly compensate the export deficit to European countries which has declined significantly due to the ongoing economic crisis in the Euro zone region.
Pakistan has a good reserve of coloured gemstones which India may import for processing. Every 11 out of 12 diamonds produced in the world are processed in India. Hence, cutting and polishing of Pakistani colour gemstones would help grow India's manufacturing sector to some extent, said Rajiv Jain, chairman of GJEPC.
While the direct jewellery export to Pakistan is set to begin soon, India's exporters are planning to restrict themselves only to business-to-business (B2B) sector only.
Kotheri said that it would be impossible for Indian jewellery exports to go to consumers like they do in other markets.
Talking about growth possibilities, Kothari said, it would depend upon how soon Pakistan’s government reduces tax barriers.
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actually, allowing the Indian jewelry industry to break into Pakistan's market will only do good to the Pakistani consumers. one thing it will do is that; it will make the jewelry market much more competitive in Pakistan. secondly, Pakistani jewelers will get the same access into the Indian industry. Remember, the jewelry market is based on product quality, not product quantity. any jeweler, be it from India or Pakistan, will make a profit if he/she make a quality product. Pakistan should not have any problems bringing in foreign investment/capital, that is exactly what it needs right now. we should be thankful that there are still some investors left who would like to invest inside Pakistan in the current circumstances. i also do not understand why some people think that the Indian jewelers will pose a national security threat to Pakistan? Indian jewelers will offer more competition; that competition will lead to lower prices in the jewelry market. we should stop our protectionist policies to 'protect' our domestic market. protectionism might turn out to be good for the producer because he enjoys a sort of an indirect subsidy from the state, but it is very bad for the consumers, who might be paying higher prices to buy jewelry in Pakistan. according to the Austrian economist, Ludvig Von Mises, providing subsidy to any market means that the producer or the government has failed to put in place the right policy that will offer chances of growth to the market.
@mr. righty rightist: as its dominant enough
How did Pakistan accept this?
This will kill Pakistani jewellery industry.
Where is DPC, now, when you need them.
Small baby steps..good for both nations!!
This is good news for both of them.....The lesser number of third parties involved,better the profit for both of them...Also,the transport charges can be minimized....
Also,Pakistan can buy pharmaceutical drugs from India.....This would bring down the price of drugs and directly help them...