Production Processing

1
Production Processing Marketing of Gemstones

• Introduction
• Need Assessment
• Proposed Project
• Financial Evaluation

2
GemstonesIntroduction

• Pakistan has reserves of emeralds, ruby, topaz,
  tourmaline, aquamarine, sapphire etc.
• Pakistan is, however, not able to benefit from
  this resource as it lacks skills in lapidary
• Most exports are in the form of uncut or raw
  gemstones
• The value addition due to lapidary can be as much
  as 1100 over the uncut form

3
GemstonesNeed Assessment

• The international trade in gemstones excluding
  diamonds is estimated at more than US18.0
  billion per annum
• Pakistans share in this trade is less than US
  50.0 million per year even though it has got the
  5th or perhaps the 6th largest reserves of
  precious and semi precious gems in the world
• All identified precious and semi precious stone
  deposits of the country have been leased out to
  the private sector for commercial exploration
• Most of the owners of the mines and individual
  miners travel with the raw uncut gems to Karachi
  to sell them to dealers
• The main export market for gemstones is also
  located in Karachi from where buyers from Europe,
  the Middle East and Far East pick and choose the
  best gems

4
GemstonesProposed Project

• It is proposed that a Gemstone Lapidary Project
  be set up in the gemstone market in Saddar,
  Karachi, where unlike the other local dealers who
  purchase on credit, gemstones are purchased on
  cash
• the Lapidary Unit may have a joint marketing
  venture with some international dealer of
  gemstones
• For Lapidary techniques another joint venture or
  technical collaboration will be needed
• One Lapidary unit may have 50,000 carat p.a
  capacity with state of the art machinery
• Area of 5,000 square feet

5
GemstonesFinancial Evaluation

• Total capital cost of one lapidary unit -
  Rs.187.0 million or US 3.1 million
• Payback period of less than 1 year
• Each Lapidary unit can easily generate upto US
  50 million sales in the 5th year using an input
  of only US 10 million of gemstones
• Ten units may be planned over a three years
  period with an investment of US 32 million
  generating sales revenue of US 500 million per
  year and net profit of nearly 40 per year