India world No. 1 in gold jewellery making

India has surpassed Italy and is now officially the largest gold jewellery producer in the world. Confirming the development, Federazione Nazionale Orafi Gioiellieri Fabbricanti Aderente a Confindustria or Federorafi, which is the federation of Italian jewellers said India has relegated Italy to second place in gold jewellery production.

Federorafi said India surpassed Italy due to “competitive production costs, better access to global markets due to lower customs tariffs, good product quality and a huge internal market,” which they say is not accessible to Italian/European goods due to high tariffs and due to administrative barriers. According to data from the precious metal consultancy, GFMS Ltd, India with gold jewellery production of 539 tonne in 2005 was numero uno followed by Italy with 228 tonne. Third spot went to China with 198 tonne and Turkey was fourth with 197 tonne. If scrap gold is included, India again emerged as No 1.

Federorafi said Italy lost out due to high labour costs, absence of trade reciprocity from other countries, towards non Organisation for Economic Co-operation and Development countries (India, China and South America amongst others), high rate of exchange of the euro compared to other currencies and difficulty in checking the distribution of goods.

Federorafi said Indian jewellery designs have reached high standards and were recognisable the world over. Italian gold jewellery has a reputation of producing sophisticated designs and for many years floral designs of Indian jewellery did not attract too many international customers. But this is now slowly changing.