India's Demonetization Seen Hitting Gems and Jewellery Sector

(IDEX Online) – The withdrawal of 500 and 1,000 rupee notes is expected to have a negative impact on consumer spending in India, particularly for luxury items such as gems and jewelry, according to media reports out of the country.

The gems and jewelry trade in the sub-continent is seen as taking a hit in the medium-term, with some reports speaking of a decline of 70 percent.

The so-called demonetization program is aimed at cracking down on corruption.

The majority of gems and jewelry transactions in the country are in cash, which will make purchases and payments for big-ticket items difficult to transact.