China emerges as the second-largest importer of gems, jewellery in FY17

Exports to the South Asian country jumped jumped by a staggering 28.48% to $2.48 bn

China has emerged as India's second- largest destination for gems and jewellery exports after the United States(US) in the financial year 2016-17 due to a slowdown in the European Union(EU) and an import tax levied by the United Arab Emirates(UAE).

EU and UAE are the two other major destinations for shipment of precious metal jewellery and stones from India.

Data compiled by the Union Ministry of Commerce showed that export of gems and jewellery to China jumped by a staggering 28.48 per cent to $2.48 billion in FY17.

"China is the second-largest economy in the world after the US. Then, why not increase our gems and jewellery exports to the country? Aiming to boost our exports, we organised several bilateral trade opportunities including buyer-seller meets with Indian diamond jewellery manufacturers. So, the increase in jewellery sales to China was expected. We see 100 per cent growth in opportunity in few more years," said Sabyasachi Roy, Executive Director, Gems and Jewellery Export Promotion Council.

While some varieties of gems and jewellery, especially the high-end jewellery worth over $1,000 contracted in the US, the country continued to account for 40 per cent of India's gems and jewellery exports.

Meanwhile, China's gain can also be attributed to a decline in exports to UAE, which levied a 5 per cent import duty for local sales of gems and jewellery. Re-routing, however, continues to attract "zero" import duty in the West Asian country.

Many domestic jewellery manufacturers have opened retail ventures in UAE that coincided with the re-routing policy followed by India in terms of increasing exports in European and African countries.