Gems & jewellery exports slipped 30% to $2.17 billion in October: GJEPC

Sector hopes for relief as FTA talks with the US and EU progress; FY26 exports may still reach $30-35 billion

India’s gems & jewellery exports witnessed 30.6 per cent year-on-year (Y-o-Y) contraction in October to $2.17 billion, amid the imposition of a steep 50 per cent tariff by the United States (US) on several Indian products. 

Gems and Jewellery Export Promotion Council (GJEPC) chairman Kirit Bhansali, however, exuded optimism despite the external challenges. He expects exports for FY26 to hover around $30-35 billion, compared to $29.8 billion in the same period a year earlier. 

“Despite tariff issues, we have maintained our target for natural diamonds; the demand is good. The lab-grown diamond segment is doing well; so there is no direct job impact. According to the feedback from the commerce ministry and even from the Prime Minister, free trade agreements (FTAs) with the European Union (EU) and US are on the pipeline and will happen soon. Strong negotiations are on and India would like the deals on their terms and conditions,” Bhansali told Business Standard, adding that the deal(s) may happen this month. 

Gems and jewellery is one of the top five export items from India, with a share of around 7 per cent of the country’s overall exports. 

India exports diamonds, gold, silver, platinum, as well as imitation jewellery. 

However, over the last few years, gems and jewellery exports have fallen from over 10 per cent, mainly due to geopolitical uncertainties, and the latest one being Washington's protectionist policies. 

On a cumulative basis (April-October), exports stood at $16.26 billion, down 2.7 per cent Y-o-Y, according to GJEPC data.

“Exports to two major countries have been affected very badly — one is the US and the other China. I don't see any immediate recovery in China, but in another three-six months, there may be some,” Bhansali said. 

He added, “The US is a good market, and there is good demand. Once the FTA is signed, we are hoping to be back on track in the US market also.” 

However, exports to West Asian nations such as the United Arab Emirates (UAE) and Saudi Arabia have been good, he said. Also, exporters are waiting for the trade deal with the United Kingdom (UK) to kick-in. 

As part of the pre-Budget recommendations to the finance ministry, the council has sought policy reforms to enhance the sector’s global competitiveness and ease of doing business. 

Key proposals include liberalising taxation, rationalisation of import duties on cut and polished diamonds and coloured gemstones, introducing an ad-valorem duty drawback mechanism for gold and silver jewellery, and extending export incentives to platinum and gold articles, said Bhansali. 

The council has also urged the government for greater operational flexibility in special economic zones (SEZs), a full tax refund scheme for foreign tourists, and continuation of duty exemption on seeds for lab-grown diamonds. 

These measures will help sustain exports, boost domestic manufacturing, attract investment, and secure India’s leadership in the global gems and jewellery value chain, he said.