Silver, while slightly trailing gold, mirrored its upward trajectory, signalling a strong comeback. Despite this, the performance of precious metals as a whole has been somewhat mixed, with some volatility in the market.
The jewellery market witnessed a significant shift in 2024 with the growing popularity of lab-grown diamonds. Favoured for their affordability and sustainability, these diamonds are rapidly gaining consumer preference. The market for lab-grown diamonds in India is projected to quadruple by 2033, prompting major players like Tata to make substantial investments. Meanwhile, natural diamond stockpiles continue to increase, potentially influencing market dynamics further.
To discuss the year gone by and the outlook for 2025, CNBC-TV18 spoke to Ashok Gautam, MD & CEO of IIBX at GIFT City; and Smit Patel, Director of Greenlab Diamonds.
Edited Excerpt:
Q: Gold demand within the Indian markets itself has been on the higher side. We’ve seen an all-time high in this year. It also has been the best return that we’ve seen in this year since 2010. So, in many ways, gold has seen 2024 as a landmark year. How would you take a look back and summarise that for us?
Gautam: The kind of interest the gold rally has generated among investors and buyers is due to a couple of reasons. One is, of course, that geopolitical reasons triggered the gold rally, which I’m sure many of the investors have now gained a lot of benefits from. But traditionally, the gold import numbers in India have been quite consistent. So, whatever the gold value, whether in dollar terms or rupee terms, there has been a consistency of around 800 tonnes, plus minus 50 tonnes here and there. So that remains constant, and that is something which the international market is also observing.
Secondly, globally and within India, we have seen the central banks increase their buying of gold. This has also led to the gold rally continuing and many central banks diversifying their safe assets, whatever they keep in various currencies. So, some of that has now been moved to gold.
The reduction in customs duty from 15% to 6% has helped gold buyers greatly in India.
Q: More listed companies are getting into lab-grown diamonds now. We’ve seen demand continue to grow. We’ve seen prices stabilise as well in 2024. How would you look back at the year and summarise it for us?
Patel: In 2022-2023, India exported 4.7 million carats of lab-grown diamonds. In 2023-2024, it was 7.81 million carats, and this year, in the two quarters, we’ve already surpassed that by reaching 9.18 million carats of lab-grown diamonds exported that have been cut and polished in India, and mostly grown in India. So that’s a very positive sign for this industry.
We see that worldwide, the demand for this is continuing to grow, and we can expect the same kind of rise happening in India as well.
The major companies are also trying to test the markets in lab-grown diamonds. This is because the customers are demanding lab-grown diamonds. No kind of mass marketing has happened around this product. But I think in this new technological age, the consumers realise that this is the potential future, and the potential for creativity and jewellery is all being explored in India as well now.
Q: What about the prices? Would you say after the very sharp correction that we saw in 2023, 2024 was a year of stabilisation?
Patel: The amount of total export has not decreased, even though the prices have corrected. Price correcting became a very healthy thing for this industry. Since it was a new-age industry, the prices were high initially. However, the price correction has allowed many other players to enter this business now, taking fewer risks and exploring the jewellery industry worldwide.
Watch the accompanying video for the entire discussion.
