As war bells ring, gold becomes the first casualty worldwide. But in India, where jewellery is a way of life, experts say there is never any let down in buying gold: only the preferences of Indian women change - from heavy to light weight jewellery.
US-Iraq war is no different, they say, noting, "The craze for buying jewellery is too much for any war, especially which is miles away, to shadow it."
"This can also be gauged from the fact that jewellery exhibitions are a big hit these days... one national exhibition cum sale is currently going on in Delhi, from where it will travel to Mumbai," says Syed Zakir Ahmed, organiser of Jewels 2003, noting "in three days we plan to do a business of over Rs 6 million here."
The aftermath of September 11 attacks and the Indo-Pak standoff last year notwithstanding, jewellery exports went up by over 13 per cent this year, says Ahmed.
"The uncertainty was more before the war when the prices of gold went over Rs 6100, and there was some slowdown in domestic buying... but war has rather calmed down the markets and the prices are now down, which means that Indian women can add more to their collections," says Hema S Kothari, a Mumbai-based exporter.
"Exports to the western countries will also not be much affected as most of the exports are to US, UK, Hong Kong and other European countries. December and April are Christmas and new year, we get the orders by August, while for April and May (thanksgiving, graduation etc), the orders come by January. Thus, the exports would only be hit if war goes on for three to four months or longer," says Kothari.
However, P K Ganguly, an industry analyst, is not all that optimistic. He says, "War will definitely affect gold. Though in the initial stages, it is going down due to speculative selling. If war goes on it is certainly going to rise - the yellow metal fell during the first few days of the Gulf war."
And this will directly affect the buying of gold by Indian women. At present the effect can not be much because it is not the wedding season. But come April and we would know.
"In that case, only their choices will chance... from heavy jewellery, they would go in for light weight jewellery. Gold forming jewellery is also in great demand during these times - a set costs between Rs 1,000 and 5,000," says Anil Jain, a Mumbai-based jeweller.
Agrees Dharmendra, a Delhi-based jeweller, "During hard times, women go in for gold plated, silver or even ethnic designs. Though these designs are anyway trendy these days, but their sale is bound to rise, if war continues for long."
"Generally in India, gold is bought for marriages, gifts, or even personal collection. Though there will be no compromise for marriages, its gifts which will be affected in the long run," Dharmendra says.
Speculating some effect on the gold trade, Jatin Seth, another Delhi-based jeweller, says if prices remain down, people would definitely go in for buying it. Also, diamonds are the latest craze as they too have full resale value.
Ganguly, however, is not optimistic about exports and says they too would be hit to some extent, especially to Arab countries where sales are all through the year.
Moreover, it is no longer considered a safe asset as people prefer to keep cash during bad times and not gold biscuits or buy gold. Those days are gone, says Ganguly.
