rediff.com

NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  

Rediff News  All News 
Rediff.com  » Business » Kuwait gold souk traders tense as war draws nearer

Kuwait gold souk traders tense as war draws nearer

January 30, 2003 16:13 IST

In troubled times the fluctuating price of gold is used the world over as a political barometer and the fabulous gold souk in Kuwait City is no exception to this age-old tradition.

Customers keep away from gold souks in Kuwait as war draws near. Photo: Shyam BhatiaAs war with Iraq draws closer in the Persian Gulf, Indian traders dealing with the purchase and sale of the precious metal report a 15 per cent increase in prices from $10 per gram less than a month ago to today's $11.50.

For those used to buying gold along more traditional measures, the jump is from $11 per gram to $13.33 per gram.

Outside the gold souk along Kuwait City's well-kempt roads and boulevards, there is no outward sign of panic or even tension.

Traffic jams are still the norm between 1 p.m. and 2.30 p.m. on most working days and there are more luxury cars per square kilometre than anywhere else in the world.

Inside the souk, though, it is a different story.

Indian dealers admit there is a new nervousness about what may happen. "Tension is there," says Fakhruddin Mohammed Hussein, a 35-year-old gold trader from Dungarpur district in Rajasthan.

"Business has reduced to zero, all people are afraid of war."

Married with two small children, Hussein is a veteran of the last war when he was evacuated via Iraq and Jordan back to his home village in Rajasthan.

This time that evacuation option will not be available, since the Iraq border will be closed if, as expected, the Americans launch their land war against Iraq from their bases in Kuwait.

"I go to sleep at 1 in the morning," continues Hussein. "I wake up at 4 in the morning for namaz. Most of the time we are watching CNN and the BBC."

Fellow gold trader Mohammed Chiklikh, also from Dungarpur, shares his uncertainty over what will happen. This 26-year-old father with a young, three-year-old daughter says he is determined to stay, come what may.

"If Saddam launches a rocket against us, we will study the situation," he explains. "Then we will decide what to do."

The gold traders of Kuwait are part of a 300,000 strong Indian community, the largest single community of foreigners in Kuwait, followed by the Egyptians and the Pakistanis.

Until a week ago, the vast majority were sanguine about the developing crisis with Iraq. Reassured by the huge American military presence the feeling on the street was that war could be avoided.

What has changed is Iraqi Deputy Prime Minister Tariq Aziz's warning that Kuwait could be targeted in any forthcoming conflict and President George Bush's denunciation of Saddam Hussein as 'deceptive' and 'deceiving.'

United Nations weapons inspection chief Han Blix's report in which he says Iraq cannot account for some 6,500 missing chemical warheads has also come as a shock to Kuwaitis and foreign workers alike in this oil rich sheikhdom.

"The only fear here is chemical warfare," says Tuffy Jaggi, the Colaba, Mumbai-born sales manager of a well known picture studio in Kuwait City centre.

"There could be a few missiles here and there, but of course no one can say for sure what will happen. He (Saddam) may retaliate, but most people are not convinced there will be any Iraqi penetration into the country."

Jaggi is another veteran of the 1990 Iraqi invasion. He was evacuated via Iraq and Jordan back to India. An Indian friend and colleague took his brand new sports car and reached India via Iraq, Turkey, Iran and the Wagah checkpoint on the Indo-Pakistan border.

As the political military uncertainty continues to prevail, Jaggi says his business is suffering. Sales on some days are down by as much as 30 per cent.

Similar business gloom is reported across the road at Jashanmal, the upmarket department store with branches across the Gulf that was founded 84 years ago by a Sindhi businessman.

The store which stocks such fashionable labels as Burberry ties and jackets priced at $885 is currently participating in a Spring sale with prices slashed by as much as 75 per cent.

"Yet the store is far from crowded and the mad rush that used to characterise previous sales of this magnitude has yet to materialise."

"But we are doing fine," says Jashanmal showroom manager Mani Pillai, who has worked with the company for 38 years. "There is no need to run away, we will take it as it comes."

But even the unflappable Pillai, who has a 21-year-old son living in Bangalore, agrees there are business jitters. "People are not sure," he says. "They don't know how much they should spend."

He agrees that the queues at local banks are a little longer than usual and airlines leaving Kuwait are booked to capacity. Despite this, he says, caution is the watch word and wait-and-see the maxim for everyone to observe.

Gold sets new record at Rs 6,020
Shyam Bhatia in Kuwait