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It's a damp Diwali in Britain!

By Prasun Sonwalkar in London
October 24, 2008 13:50 IST
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Sales of firecrackers, gold and jewellery have plummeted due to the economic downturn in Britain, spreading gloom among companies that otherwise make brisk business during the festive Diwali season.

Across Britain, people of Indian origin have reduced spending on gifts such as rings, necklaces and bracelets. This year, local councils have emerged as the main organisers of fireworks and other Diwali-related occasions.

Manjula Sood, the Lord Mayor of Leicester, last week inaugurated the lighting ceremony on Belgrave Road, which is also known as the Golden Mile due to the large number of jewellery shops lining it.

However, this year the Golden Mile has lost some of its sparkle as jewellery sales have plunged drastically due to the economic slowdown.

Some shops there have reported a 50 per cent fall in jewellery sales.

Leicester has a large population of Indian origin and has earned the reputation of holding the largest Diwali celebrations outside India. The local council extends considerable support to Diwali festivities every year.

Jaffer Kapasi, director of Leicester Asian Business Association, said Diwali was always a busy time for Asian jewellers in Leicester but this year trade was 'drastically down'.

"A lot of people are used to exchanging gifts at this time but there's been a real cutback on spending. With all the doom and gloom, people are being very careful," he told the local media.

"Jewellers don't foresee an immediate turnaround -- it could be up to a year before things recover."

Rajesh Pattni, of Kampala Jewellers, said profits would be down by tens of thousands of pounds this year. He said: "It hasn't been this bad since the 1980s. For us, it started slowing down around January because of the rising cost of gold. This has affected how we price our jewellery.

"We are getting ready for Diwali, but with the credit crunch and other problems, people are panicking and not spending. These are luxury items and are at the bottom of the list when people have mortgages and other essentials to pay for," he said.

Pattni added that his company usually ordered extra stock worth between 50,000 pounds and 80,000 pounds during this time of the year, but now it had ordered only worth 20,000 pounds.

Raj Naran, of G Naran Jewellers, said his sales had plunged by a third this year.

"We've seen downturns before but nothing of this magnitude. Everyone has been feeling the effects. Fortunately, we have been established as a business since the 1970s and we hope that helps us," he said.

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Prasun Sonwalkar in London
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