BackThe love affair with gold
Indians have always loved gold, but the jewellery buying trends have undergone a change in the post liberalization era
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New Delhi: Two days before his final BCom exams, Anup Agrawal received an urgent missive from his family-run jewellery store. It was peak wedding season and the customers just wouldn’t stop pouring in, so could he make his way to the store to help out?
“Honestly, education while important wasn’t the main priority. For us, work has always come first. I started coming to the shop when I was six years old," recalls the 47-year-old jeweller. The “shop" that he is talking about is one of Varanasi’s oldest and perhaps the most well-established jewellery establishment—Kanhaiya Lal Saraf. Agrawal is the fifth generation member to run the business. “At the beginning of the 20th century, my ancestors used to go door-to-door, selling jewellery. In 1910, we set up our first shop," he said.
From the Gold (Control) Act to the entry of corporate players in the market, the changing demands as well as the attitudes of customers, Agrawal and his family have had a ringside view of India’s love affair with the yellow metal. “It is the one thing that everyone, be it a ruler or a farmer, considers their greatest investment and time and again, I have seen gold come to the rescue of beleaguered families," says Agrawal.
Today, gold shopping involves visits to glitzy showrooms, where you are plied with coffee and soda, and choosing from different designs and styles. There are annual schemes that invite you to invest a certain amount of money every month on completion of which you can buy gold equivalent to that amount. Obscure festivals such as Akshaya Tritiya have been turned into marketing opportunities by the gold industry, with a little help from television soaps.
“But all this is now. You should have been around when the Morarji Desai government had introduced the Gold Control Act in 1968. Jewellers were not allowed to keep more than a few kilograms of gold in stock while consumers could only possess gold in the form of jewellery. You could not own bars or even coins. Goldsmiths could keep with them gold limited to a few hundred grams. So many jewellers went out of business."
The law was aimed to control sale and holding of gold in personal possession. “But in spite of restrictions, people’s appetite for gold never lessened, though the bulk of the buying was always centred around weddings. During summer months when wedding season was at its peak, we used to hand out tokens to customers. People would start lining up at 6.00am and wait patiently till 2.00 even 3pm. We would wrap up the day’s work only around midnight," recalls Agrawal.
Agrawal’s observation about gold coming to aid in the most distressing times holds true not just for families but also the country. In 1991 India had to pledge gold from its reserves with the Bank of England as the country teetered on verge of defaulting on external liabilities. It was the last straw to break the camel’s back and the country embarked on economic reforms.
The Gold Control Act too was repealed. “Slowly, the scene started changing. Earlier there were 250-300 shops in Banaras, now there are in thousands. Even we have expanded, not just in the jewellery trade but by dabbling in other businesses also, including a Hyundai car dealership, another sector which has seen a boom since economic reforms." The entry of corporate houses in the business, expansion of older more established family owned brands, the changing demands of consumers—all of it took place around this time.
“Earlier, there were only a few designs and no one asked for anything different. Today, when I go to watch a movie like Bajirao Mastani, I have my camera phone ready so as to click photographs of the designs since I know in a couple of weeks, the customer would want this," he says laughingly. Jewellery designing has emerged as a bona fide profession and people, especially women, now buy gold more often.
“I have observed closely how the attitude of the woman customer has changed. Earlier, there was no question of them buying trinkets for themselves, but as more and more women enter the work force and there is more disposable income, they come here more often and pick up things. It is usually something like earrings or a ring, sometimes even a bangle."
So, does he see it as an indulgence on the part of the women? Agrawal is quick to disabuse that notion. For, even though people might be buying jewellery for vanity and daily wear now, it is still seen as a “good buy", “an investment. Shaukiya khareed nahi hai yeh. (It’s neither indulgence nor impulsive)."
With buying ability, awareness levels have also gone up, remarks Agrawal. Customers are aware about things like hallmarking and demand to know about the weight and purity of the gold. “They want to know the resale value in case they come back a year later to get the piece exchanged. The government now aims to make the hallmarking of gold jewellery compulsory this year. This is a much-needed move. Our jewellery is already hallmarked and we encourage our customers to look out for it even when shopping elsewhere."
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