By 5 p.m., the usually bustling Pot Market in Hyderabad had fallen unusually silent, with only a handful of customers trickling into jewellery stores. Inside Viswanath Jewellers, salespersons sat waiting as gold prices swung wildly within hours. “Yesterday at 9 p.m., gold was ₹1.55 lakh. By 1.32 a.m., it had shot up to ₹1.74 lakh, and now it is ₹1.66 lakh. These fluctuations will put us out of business,” said Kishore, pointing to a live price-tracking app. He said a customer who booked 10 tolas the previous evening could not now be charged the revised rate at the time of delivery.

Pot Market is a jewellery trade hub with over 300 small and medium shops near the Secunderabad Monda Market packed into a one-kilometre quadrangle. While the jewellery trade is brisk on regular days, the area also acts as a way-centre for gold retail trade of districts with small and medium workshops jostling with pawn brokers who live and work out of the residential and commercial street.

“Bomb phat gaya election ke baad (a bomb has exploded after the elections). Today appears like a Sunday. We usually get 25-30 customers a day. But today there are none. The high price of gold and today’s decision to increase import duty from 6% to 15% has dealt a blow to our business,” says Parasmal Ranka, president of Telangana Pawn Brokers and Jewellers Association.

While traders and businessmen rue the prospect of lower business volumes and thinner margins, it is the families planning to purchase gold for weddings and investment that have been affected. “We came to buy jewellery from Bowenpally. But now we doubt whether the price will stabilise or go up. We are undecided. On top of it there will be moodam (inauspicious period) after two days. Already the price has gone up by over ₹50,000 from the last time we saved up to buy jewellery here,” says Prakash Goud as his family waits inside a jewellery store.  

On the high street of jewellery in Panjagutta, the usual rush of cars jostling for parking space was missing on Wednesday. “Our sales have dropped 27% from last year and that is after multiple promotion offers. Other smaller shops have seen their business drop by 30 to 50%. Our 60-70 walk-ins have dropped to 10 to 15 which is very worrisome. Big retailers like us will ride out, but smaller retailers will go under if this uncertainty and high prices persist,” said the CFO of a jewellery store in Panjagutta.

Gold purchases are also expected to shift from jewellery to coins and bullion where the margins for traders are very thin. “Gold jewellery will become inaccessible for the poor and the class. It will become an elite thing. We had 60% exchange and 40% purchases. This will shift to 85% exchange and 15% purchase further eroding the margins for small and medium traders,” informed the jewellery store honcho.