Gems and jewelry industry in Pakistan increases global competitiveness with USAID help

A worker in a Karachi workshop solders gold bangles with a gas flame.

For the first time, gems processors and jewelry manufacturers took a national delegation to a global trade fair in 2005, increasing Pakistan's visibility and landing $4 million in export orders - in just one show, netting 14 percent of annual industry exports

Pakistan's gems and jewelry sector is often described as a cottage industry, with four- to five-person workshops crafting pieces by hand or with outdated machinery. Most manufacturers cannot cater to international markets, which prefer 14 to 18 karat gold, not the 22 or 24 karats popular domestically. Three-quarters of the $28 million in industry exports in 2004 were rough stones: despite the country's abundant mineral reserves, processors lack the expertise to cut stones to global standards. Manufacturers usually attended global trade fairs as individuals, failing to garner much buyer attention. Unleashing the industry's tremendous potential would increase export revenues, entrepreneurship and employment, and reduce the level of poverty.

Since 2004, that potential is being realized through industry cooperation fostered by a USAID-led working group. Since the group's formation by USAID partner JE Austin, industry players from "mine-to-market" have pooled resources, hired international experts for training workshops, sought globally recognized certifications and won crucial recognition of industry status from the government. Eager for upgraded machinery and trained labor, the working group has made training a top priority. "We are spending our money and our time to get this industry developed for the entire trade, not just for individual owners," said Shafi Choksy, owner of Jamesy Jewellers in Karachi's bustling Tariq Road business district. As a result, industry players have formed delegations to visit trade shows, gemology institutes and manufacturers in the United States, Thailand and India to learn about new machinery, international trends, trade policies and marketing strategies.

In an indication of changing times, 45 delegates from 18 com-panies and the government small business development authority exhibited at the Bangkok Gems and Jewellery Fair under a single Pakistan brand in 2005, netting more than $4 million in export orders. The show brought orders equal to 14 percent of total annual exports the previous year, highlighting the industry's great potential for growth. The sector's higher profile has been helped by a group meeting with Prime Minister Shaukat Aziz and a visit from US Ambassador Ryan C. Crocker. "This has created a buzz of excitement," said Matiullah Shaikh, an exporter who bagged large orders at the Bangkok fair. "We are making progress because USAID has taken a role."