The uncertainty of the pandemic has kept everyone on tenterhooks. While the government is trying its best to minimize the outbreak and contain the ripples of the virus wave, the economy is far from bleeding and industries are at the edge of the storm – that has so violently shook the core and making everyone swim in the deep unchartered waters.
Every situation puts forth a new challenge and while there are multiple plausible outcomes, none can be determined without taking the x and y into account. Going forward in the industry each one of us will have to thoroughly keep in mind that change is constant, while some of the changes that the pandemic has brought about are temporary, certain are here to stay permanently.
In my four decades of experience in the gold and jewellery industry, I have witnessed multiple winds of change and upheavals, but the year 2020 marks a paradigm shift in our approach towards the outlook of the future of this industry. The future that everyone now envisions is a part of my core value upbringing. My father at the onset of my career had told me to treat every karigar, every worker as a part of my family and it is perhaps this teaching that has dictated the steps I am going to take forward to ensure a safer workspace environment for all as well work for the health care benefits of those who work in our industry.
Amidst the lockdown when the migrant karigars fled to their homes in the rural areas, we knew that their return back would not be very soon. But their flight was an eye opener. The catastrophe paved the way for a humanitarian crisis that had been looming large but was never addressed. This section of the society forms the crux of any industry and yet one major breakdown saw all of us failing them. We as an industry body did come together to provide food and medicines to them but the association knew in that moment that a new landscape had to be charted to develop a system that benefited them and thought for them.
The greatest fear looming around is will the economy recover and to what extent will be the impact. What will be the course forward? And of course optimism doesn’t come easily! The top gold dealers of India and their association came forward to discuss. Different outcomes were suggested but the distilled scenario was that money is negotiable and it is most probable that post the lockdown the workers will demand higher wages looking at their safety but what is more important is for the hundreds of workers joining back to understand how lifestyle changes will have to be incorporated by themselves to ensure a hygienic routine. While we will leave no stones unturned to provide them a safe environment, workers themselves will be playing a crucial role in ensuring the safety of their brethren.
Any time frame of days, weeks or months is no true answer to the question when will there be a recovery. As the market re-opens, there will be a huge liquidity crisis. I don’t feel there will be any demand in 2020 besides that of investment. I believe it will take at least 6-9 months for the demand to resume. Also in India, 70% of the gold is purchased in rural areas in the form of physical gold such as coins, bars and plain jewellery that has the minimum making charges. However, with the loss in jobs that we have observed during the lockdown, lower class & middle class will shy away from saving trying to make their ends meet. I believe the investment demand will be from the upper classes mainly.
We will have a better understanding once the Diwali season is over. It will be a slow and gradual process but one that will certainly heal all of us together. However, let’s hope 2021 to be better in terms of demand and consumption.