INTRODUCTION
The gems and jewellery industry of India contributes 7% to India’s Gross Domestic Product (GDP). The industry employs more than 5 million of skilled and semi-skilled workforce in the country. The sector contributes about 10-12% of India’s total merchandise exports, accounting for the third largest commodity share. During 2021-22, the gems and jewellery exports played an instrumental role in growing India’s overall exports to US$ 419 billion with a growth of 44% from 2020-21 and 34% from 2019-20.
The Government of India, along with all the stakeholders of gems and jewellery sector, is well committed towards aggressively promoting exports, identifying challenges and addressing them with necessary interventions, assisting exporters, especially SME units, and exploring new markets while consolidating existing ones. With strong growth prospects, the government of India has also declared the gems & jewellery sector as a focus area for export promotion.
India majorly exports cut & polished diamonds, lab-grown synthetic diamonds, colored gemstones, synthetic stone, plain and studded gold jewellery, silver & platinum jewellery, imitation jewellery and articles of gold, silver and others. Western Region is key exporting hub for the gems and jewellery industry contributing almost 77% of the total exports in 2021-22. Surat, a city of Gujarat state in the western region of India has more than 450 organised jewellery manufacturers, importers & exporters, making it the jewellery manufacturing hub of the world.
EXPORT TREND
As per 2020 statistics, India’s gems and jewellery exports account for about 3.5% of the world’s total exports, making it the seventh highest exporter in the globe. The country is ranked first in diamonds jewellery, silver jewellery and lab grown diamonds & Synthetic stones with 29.0%, 22.0% and 32.7% share of the total world’s exports respectively. The overall gross exports of gems & jewellery stood at US$ 20.58 billion in FY23 (until September 2022). The overall gross exports of cut & polished diamonds stood at US$ 12.22 billion in FY23 (until September 2022).
The Department of Commerce has set a gems and jewellery exports target of US$ 45.7 billion for 2022-23. The department is committed to enabling exporters by providing a conducive trade environment by bringing up trade-friendly polices to boost exports. The top export targets set for key countries in 2022-23 are USA (US$ 16.16 billion), Hong Kong (US$ 11.86 billion), UAE (US$ 6.36 billion), Belgium (US$ 2.89 billion), Israel (US$ 1.66 billion), Thailand (US$ 1.17 billion), Singapore (US$ 850 million), Japan (US$ 462.43 million), France (US$ 245.5 million) and Botswana (US$ 246 million).
EXPORT DESTINATIONS
India exports gems and jewellery to USA, Hong Kong, UAE, Belgium, Israel, Thailand, Singapore, the UK, Netherlands, Japan, etc. USA is the largest importer of Indian jewellery with the 2021-22 imports valued at US$ 14.5 billion growing from US$ 8.7 billion of exports in 2020-21. Hong Kong and UAE are among the largest export destinations for India at US$ 9.3 billion and US$ 5.7 billion in exports contributing about 23.7% and 14.5% of the total exports during 2021-22 respectively. Few other key export destinations like Israel, Thailand and Netherland have shown significant growth with exports valued at US$ 1.5 billion, US$ 1.2 billion and US$ 694.6 million recording growth upwards of 60% over 2019-20 levels.
During 2021-22, some of the key export destinations like Israel, Thailand, UK and Netherlands have shown steep growth in the upwards of 55% in the gems and jewellery imports from India over the pre-pandemic year 2019-20. This can be mainly attributed to the return to pre-pandemic ways of consumer spending and increase in retail store sales after removal of all covid-19 restrictions. Additionally, the opening of the India Jewellery Exposition (IJEX) center in Dubai, signing of agreements with key export destination such as UAE, Australia, Israel, UK, Canada among others should continue to drive the exports in the future.
GOVERNMENT INITIATIVES
The Government of India (GoI) has taken various measures to promote investment for growth of the sector, such as gold monetization scheme revamp, reduction in import duty of gold, reduction in import duty on cut & polished diamonds from 7% to 5% and implementing mandatory hallmarking. Under various other schemes, about 90% assistance is provided by government of India for setting up of common production/processing centers, design centers, testing facilities including plug & play facilities. Marketing hubs / exhibition centers by associations are also receiving the Government of India’s assistance of up to 80% of project cost. Additionally. The government has allowed extension of emergency credit line guarantee scheme (ECLGS) for MSMEs up to March 2023. Over 90% of units in gems and jewellery sector are MSMEs.
The Government of India has recently laid out four steps to grow the gems and jewellery industry in the country. The focus is to be given to the creation of patented designs to increase value, diversification of the exported products, collaborate with other nations for cost-effective methods and promotion of lab-grown diamonds. In addition to this, the GJEPC (Gems Jewellery Export Promotion Council) arranges several trade shows, buyer-seller meets and expositions to increase the exposure of Indian goods.
GOVERNMENT BODY
Gem and Jewellery Export Promotion Council (GJEPC)
The GJEPC was formed in 1966 and has over 7,500 members associated with it to date. The objectives and roles of the council are promoting the brand India, connecting government and trade, upholding diamond integrity, spreading education, innovation and infrastructure, etc.
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