 "Photo: Reuters")
Post-demonetisation, Mumbai's bustling and glittering Zaveri Bazar, the national bullion and jewellery market, wears a forlorn, deserted look.
Thousands of big and small jewellery shops and glittering showrooms in India's oldest and biggest hub, as well as retail outlets in the eastern and western suburbs, eagerly await the elusive customers.
The annual big, fat wedding season that is underway- with an average of 15,000 weddings scheduled in Mumbai every month till May-June- usually means a money-spinner. This year it is passing by without a ripple.
"I have taken some small orders for bridal gold jewellery sets, well before the demonetisation and kept them ready. Now, the customers are not prepared to take delivery as they have no money to pay their bills," rued S K Velly, the proprietor of Pramila Jewellers in the suburbs.
Some customers are now demanding that they be permitted to make payments in instalments, but Velly rejected this, saying it's not possible since he has to pay upfront at all other levels -- and the ready bridal jewellery sets lie in the shop.
Many others are apprehensive of Big Brother- the Income Tax Department- and refuse to either make or accept cheque/online payments to avoid future complications.
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Major bodies like the Indian Bullion and Jewellers Association, the All India Gems and Jewellery Trade Federation, the Mumbai Jewellers Association and other trade associations are "extremely concerned" but unable to do much.
Mumbai Jewellers Association Vice President Surinder Kumar Jain said that in terms of volumes, the industry has taken an unprecedented beating with business down by "more than 90 percent" in the peak wedding season.
"The average sales here is around 3.4-4 tonnes of gold, bullion, jewellery, and other items, worth an estimated around Rs 125 crore. Post-demonetisation, it has plummeted to less than 10 percent daily, or around Rs 10-12 crores value," Jain revealed.
After a modest 2015, this year was expected to herald cheerful days with a good monsoon, overall positive sentiments in the economy and the bullion industry was preparing to cash in on a good 2016.
Since January, Jain said there have been huge imports of gold, around 120 tonnes, to cater to the marriage season, investments and corporate requirements. "But that investment and gold is simply stuck. We can't sell it or throw it away."
Both Jain and Velly are worried that if the supply position of currency notes does not improve immediately, they may be compelled to down shutters, retrench staff and move out to other smaller locations in the country.
The industry directly employees around 3.75 crore artisans across India, besides another 50-lakh plus in jewellery trade like owners of retail shops, their well-paid staffers and other allied service providers.
Mumbai Jewellers Federation President Rakesh Shetty said that "gold, silver and jewellery shops are full" but there are no takers after the demonetisation of Rs 500 and Rs 1,000 currency notes.
"There are some claims that a part of the business has gone to the online portals, but that is far from the truth. We are in a severe crisis, never seen before," Shetty said.
While around 5,000-plus shops and showrooms are located in the crowded Zaveri Bazar in south Mumbai, another 27,000-odd dot the city and suburbs, accounting for nearly two-thirds of all gold trading and business in India.
Some of the smaller shops with minimal stocks of gold or silver jewellery, struggle to make ends meet with repairs or polishing or modifying customers' existing jewellery, but that is barely 10 percent of their normal business activities.
Shetty said that against cheques, RTGS (real-time gross settlement) or new currency notes, gold is being sold in minuscule quantities by retailers at around Rs 29,000 ($422) per tola (10 gms).
"The rates have sharply come down by around Rs 1,500 per tola since Dhanteras (preceding the Diwali festival in late October). Actually, this is the start of the annual wedding season... we were expecting much higher gold prices this year on account of various positive factors, but demonetisation has dealt a deadly blow," said Shetty.
"The current situation is very tough. We have passed through some very rough or recessionary patches in the past, but this is unprecedented. Demand and supply exist, but there is no money to conduct any business, people prefer to first spend on survival before buying jewellery," lamented the owner of a leading jewellery shop in the posh Juhu neighbourhood, preferring anonymity.
Worse, the leading players predict an uncertain, gloomy period ahead till December 30, followed by the Union Budge on February 1, 2017, and the upcoming GST to be implemented from April 1, 2017.
