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Akshaya Tritiya: Covid in India, travel suspension deter expats from buying gold

Dubai - Jewellers hope sales would pick up in the months of June-August, which are an important time for weddings for Indian expatriates

For the second year in a row, Indian Hindu expatriates living in the UAE ‘observed’ the auspicious occasion of Akshaya Tritiya without much fanfare.

Considered to be an auspicious time for buying gold, the festival is celebrated primarily by Indian Hindus and Jains. This year, however, gold retail outlets saw lesser footfalls as compared to previous years due to a dip in morale among Indian expatriates given the devastating situation back home.

Shamlal Ahamed, managing director of international operations at Malabar Gold, told Khaleej Times: “Even though the cases in the UAE are well under control and the vaccination rates are extremely high, the situation in India has really impacted our consumer sentiments.” Ahamed said the overall footfalls in gold retail outlets owned by Malabar Gold is much lesser compared to previous years. “Of course, we have launched several offers; but people are only buying gold for auspicious reasons,” he said.

Travel suspensions deter expats from buying gold

Ahamed hopes sales and footfalls in the retail outlets would pick up in the months of June-August which are an important time for weddings for Indian expatriates. “Moreover, because the flights from India are now suspended, the vacation buyers are also lesser than before,” he explained. Moreover, Ahamed said many second-generation Indians are getting married in the UAE now, and they are a big percentage of the outlet’s shoppers.

Given the Covid-19 protocols, many residents are also opting for online or teleshopping of gold. However, Ahamed said: “The main purchases are from those who are buying it for religious and auspicious sentiments.”

How did Akshaya Tritiya become popular in the UAE?

Joy Alukkas, the chairman of the JoyAlukkas jewellery store network, said: “A majority of our customers are from India and while we are yet to witness pre-pandemic sales, buyers have been coming into the stores in small numbers.” While investors are purchasing gold bars and coins online, a majority of the customers find it important to touch and feel gold before buying it, said Alukkas.

“Furthermore, gold prices are high right now, which must be another reason people are shying away from buying it.”

Joy Alukkas has played an instrumental role in popularising the trend of buying gold for the occasion of Akshaya Tritiya in the region. He told Khaleej Times: “Before 2002, the demand for gold was scattered. However, the World Gold Council, under the leadership of Shivram Kumar, decided to launch a campaign to promote and educate the audiences about the relevance and religious significance of buying gold on the occasion of Akshaya Tritiya,” explained Alukkas.

He added: “Since we had a presence in the Gulf region even then, a similar campaign, spearheaded by the World Gold Council was also launched here. We advertised on television as well. In the next few years, the trend picked up. Over time, even real estate agents were trying to promote Akshaya Tritiya.”

Footfalls are not pre-pandemic levels

Vinay Jethwani of Meena Jewellers also echoed similar sentiments. “Last year, it was a complete lockdown in the UAE and we re-opened just in time for Akshaya Tritiya. Most people were just buying coins and biscuits,” said Jethwani.

However, this year, expatriates are investing in jewellery and the footfalls are only slightly better than previous years, but not up to the crowds which stores were seeing in 2019. “Usually, whenever there is a festival season people travel back home. That’s when they purchase gold for their loved ones. This year, that’s not happening as much,” he stated.

Ramesh Kalyanaraman, executive director of Kalyan Jewellers, provided a more optimistic perspective since 100 per cent of all the retailer’s stores in the Middle East are operational. However, in the Middle East, the business has not reached pre-Covid levels yet. “With the newly imposed travel and flight restrictions tourism from South Asia is affected, and that naturally has an impact on the jewellery sector,” said Kalyanaraman.

He added: “Considering the very low base of 2020, this year's Akshaya Tritiya will naturally be better, but the numbers will not be comparable to the pre-Covid situation of 2019 or earlier."

dhanusha@khaleejtimes.com