Dark Dhanteras in city as gold sales dive by 35%

Business plummeted considerably in the national capital this Dhanteras as people shied away from buying gold and other metals. The festival marks the official beginning of Diwali, which, this year, has been reeling under less than enthusiastic fervour.

Goldsmiths and jewellers across the capital, and in Mumbai, Ahmedabad and Jaipur, have complained of sales nosediving by as much as 15 to even 50 per cent this year. They claim that the implementation of GST has dampened the mood in the market. As opposed to the previous practice of paying 1 per cent Value Added Tax (VAT) on gold jewellery earlier, customers now have to pay 3 per cent GST, which, businessmen say, has been a deterrent.

Speaking to DNA, Yogesh Singhal, general secretary of Chandni Chowk jewellers' association, said, "Our sales have dipped this year by at least 35 per cent as compared to last year. People have this mental block that they would be paying more because of GST. The overall festive mood is also low because spending power is also less this year."

According to some of the goldsmiths, the trade is still reeling under the onslaught of demonetization announced last year. Ramit Mehta, a jeweller from Karol Bagh, says, "There is no cash flow in the market. The economy is still affected by demonetisation and it will take some more time to recover." He said his business had been affected by about 15 per cent, and added that only those who were in "dire need" of buying jewellery, e.g., for an upcoming wedding, were making purchases this dhanteras.

Ajay Jain, another jeweller in Old Delhi said, "GST has taken away the spending power of people. They don't have money to even celebrate festivals. Business has been badly hit this year, despite it being peak season for us."
Mumbai echoed the same sentiment, with jewellery hop owners saying business was down by as much as 50 per cent in the financial capital.

Bhavesh Jain of Rajmani Jeweller at Zaveri Bazaar, said, I think people just do not have money to come and buy jewellery. Sales are down by fifty percent of what they were last year."

Amit Zaveri of Vallabdas Jewellers said despite them keeping the prices same as last year, most customers bought coins instead of jewellery. "If they were spending Rs 10,000 last year, this year the sales are down to Rs 2,000," said Zaveri.

Unlike Delhi and Mumbai, gold and jewellery sales in Gujarat did get a boost on Tuesday, though not compared to last year. While sales were higher than the recent Pushyanakshatra sales, they were lower compared to Dhanteras in the previous year. Businessmen estimate that close to 500 kg of gold and five tonnes of silver was bought across the state on Tuesday, of which over 100 kg of gold and over 1,000 kg of silver was bought in Ahmedabad alone.

Jigar Soni, secretary of Ahmedabad Jewellers Association said, "While the government has relaxed KYC norms for buying gold, people are still afraid that their transactions may be scrutinized and are staying away from high-value purchases," said Soni.

Jaipur saw saw a drop of approximately 15 to 20 per cent as compared to last year.

Traders take a hit

Traders across Delhi, and in Mumbai, Ahmedabad and Jaipur, have complained of sales nosediving by as much as 15 to even 50% this year 
They claim that GST has dampened the mood in the market