For Dubai's jewellery industry, ties with India are deep, historic and symbiotic. Sudeshna Ghosh explores how, as the emirate's diamond trade thrives, Kolkata’s artisans prove an integral cog in the wheel
At Dubai’s Gold & Diamond Park, where fine jewellery is the only commodity, vast selections of diamonds and other precious stones, gold, and silver all jostle for position in sparkling boutiques.
Cara is one such leading jewellery retailer. With five stores at the park, the vendor manufactures all of its products on-site, as such, becoming one of the recognisable names of the park. Their workshop, just a short walk from the modern shop-fronts is a bustling hive of activity, with dozens of workmen busy cutting, casting, shaping, fitting, and polishing raw materials into beautiful pieces of luxury jewellery, over the din of machinery and conversations – many of which are conducted in Bengali.
Almost all of the 150-odd artisans working here are from Kolkata, one of India’s four major metropolises, and the capital of West Bengal.
India itself is a major player in the diamond and gold industries, as both the largest diamond cutting and polishing centre in the world, as well as the largest consumer of gold.
This is in large part due to West Bengal – its Industrial Development Corporation estimates that 80 per cent of all jewellery artisans and goldsmiths in India are from the area.
According to Kiran Pethani, one of the two Indian brothers who founded Cara Jewellers, it is the artisans from Kolkata that have the greatest finesse. “It’s not just here in our workshop, all over Dubai and even in India, all the craftsmen in the diamond jewellery sector are from Kolkata,” he says. “They are good learners and hard working. But more importantly, for them, it is a traditional craft that has been learnt through generations; art is in their blood.”
Over the past few years Dubai, the nerve-centre of UAE’s gem trade, has established itself as an important global player in diamond trading, diversifying from its traditional status as a gold hub. It is now ranked the world’s fourth largest diamond trading hub, after Antwerp, New York, and Mumbai.
According to the Kimberly Process, a research body with a commitment to remove conflict diamonds from the global supply chain, the UAE imported US$5.44bn in rough diamonds in 2015 and exported US$7.56bn (a slight dip from 2014, but a massive increase from the US$1.5 and US$2.3bn figures recorded 10 years ago).
While its geographical advantages make it the ideal base for international trade, particularly in emerging markets in the East, it is also developing a niche for high-quality manufacturing, particularly for high-precision diamond jewellery usually set in 18K gold – a mainstay for most businesses such as Cara. This is where the artistic talents of Kolkata’s famed karigars (craftsmen) come into play.
While decades of communist rule had left the economy of the once-wealthy state of West Bengal on its knees, with traditional industries flagging and little innovation to make up for it, the enduring gems and jewellery industry provides a glimmer of hope.
Not only are these karigars now an essential cog in the manufacturing wheel of the UAE, it is estimated that more than 50 per cent of the jewellery manufactured in Kolkata is exported. And with the Middle East among the top three markets for the gems and jewellery sector alongside the US and UK, the capital is in prime position to take advantage.
All over Dubai, the craftsmen in the diamond jewellery sector are from Kolkata... for them, it is a traditional craft that has been learnt through generations; art is in their blood
Traditionally an unorganised and fragmented sector, recent initiatives are helping to streamline and grow the industry. This includes setting up of Special Economic Zones, educational institutions, and events such as the Kolkata Jewellery & Gem Fair, which has, over the past couple of years, hosted international buyers including from the UAE, helping to boost trade ties.
In fact, gold and jewellery accounts for almost seven per cent of India’s GDP, with the Rs 2.5 lakh crore (US$385bn) market pegged to grow at a rate of 16 per cent between 2014 and 2019.
The UAE plays a key role in this growth, with gold, diamonds, and jewellery and ornaments making up the top three commodities it imports from India. According to a study by the UAE Ministry of Economy, gold accounts for 26.4 per cent (US$17.4bn) of total imports. Interestingly, the UAE also re-exports US$5.8bn worth of diamonds to India – 76 per cent of the total value of the country’s re-exported goods.
In Dubai, a business-friendly environment provided by freezones such as the Gold & Diamond Park and DMCC (home to the Dubai Diamond Exchange), low customs duties, and strict regulations all encourage entrepreneurs to set up shop.
“We came here from a small village in Gujarat [the western Indian state that is the global centre for diamond cutting and polishing] in the early ‘90s to work in the Gold Souq; we had nothing,” recounts Anil Pethani, a founder of Cara alongside his older brother Kiran.
“After about 12 years of working here, we were encouraged to set up our own business. It was possible for us because here at the Gold & Diamond Park you don’t need a sponsor, and can start with a relatively low investment.” An AED500,000 investment by a loyal customer has grown to become a AED200m business today in just over a decade.
Theirs is not an unusual story, as many leading jewellery companies here are Indian-owned, and have benefited from the robust business opportunities for SMEs.
With jewellery, pearls and precious stones continuing to be the UAE’s single largest trading commodity – imports are valued at nearly AED200bn – the industry here is poised for growth.
“It is a definitely a strong market,” says Kiran. “Almost 50 per cent of our customers are tourists, the boost in tourism has benefited the whole industry.”
A big part of that customer base is made up of Indians too, who enjoy the lower tax-free prices and quality guarantee – making the India-UAE jewellery trade chain come full circle.