Indian trade group asks govt to partly shift gold, silver imports to US

Gem and Jewellery Export Promotion Council says step will balance trade deficit with the US

The Gem and Jewellery Export Promotion Council (GJEPC) has asked the Commerce Ministry that India partly shift its gold bar imports from Switzerland to the United States (US) to balance the trade deficit it has with the latter in this category. Switzerland comprises 35 per cent of India’s gold bar imports.

 

GJEPC also recommended a similar partial shift in silver bar imports from the United Kingdom (UK) to the US for the same reason. The UK accounts for 41.54 per cent of India’s imports.

 

The US imported $11.58 billion under the gems and jewellery category from India in 2024 but its exports were only $5.31 billion, leaving a yawning deficit of $6.27 billion. The US received 20.28 per cent of total gem and jewellery exports from India and constitutes for 12.99 per cent share in total trade in the category.

 

GJEPC made the recommendations after President Donald Trump threatened action against countries that have a large overall trade deficit with the US. India had a trade deficit of more than $43 billion with the US in January-October 2024. Trump has also imposed “reciprocal tariffs” on countries, including India: A step that can hurt India’s exports to the US.

 

The council also recommended reducing import tariffs on gems and jewellery commodities by 1 per cent to 10 per cent to reduce the gap between India and the US. It said the step will ensure that India’s gem and jewellery exports to the US will not be impacted by reciprocal tariffs. It argued that Trump's 'Fair and Reciprocal Plan' in all likelihood will lead to gems and jewellery exports to the US attracting tariffs ranging from 5 per cent to 20 per cent.

 

GCEPC recommended a blueprint to reduce, if not bridge, the trade imbalance with the US. While India imports gold worth $42.57 billion from across the world, USA’s share is just 2.9 per cent.

 

As much as 35 per cent of annual imports (equivalent to 261.26 tonnes of gold) come from Switzerland and 14.43 per cent from the United Arab Emirates. GJEPC recommended that India shift imports from Switzerland of at least $6 billion (equivalent to an incremental 65 tonnes of gold) and balance the deficit with the US in this commodity.  

 

India annually imports $2610.69 million of silver bars but the USA’s share is just 1.61 per cent compared to 41.52 per cent coming from the UK and 26.97 per cent from Hong Kong. GJEPC recommended that India should explore ways to shift some imports from the UK to the US of around US 4150 million.

 

India imports platinum bars of $95.95 million annually with the US having the largest share (16.43 per cent). GJEPC recommended that demand for platinum is increasing and India could buy more from the US.

 

GJEPC said that the 5-10 per cent tariff on unworked and worked pearls be eliminated; it also suggested bringing down the duty on polished diamonds, precious and semi precious stones from 5 per cent to 2.5 per cent.

 

For gold, platinum and silver bars imported from the US, it recommended reducing the 5 per cent tariff by 1 per cent. It suggested a 3 per cent reduction in 20 per cent duty on gold, silver, platinum, silver and gold articles.

 

A senior GCEPC executive said that reducing tariffs is not expected to lead  to an influx of jewellery brands in India. A 1 per cent reduction on gold, platinum and silver bars will be in line with what India has done with the UAE (duty is linked to tonnage imported from the country).

  How gold bar imports shift to US can change the trade deficit 

Countries	Qty in tonnes	US ($ millions)	% share of total gold bar imports
Switzerland	261.26	16,452	35.13
UAE	107.3	6733	14.43
South Africa	68.93	4297	9.27
Peru	51.75	2364	6.96
Australia	34.25	2118	4.61
Bolivia	22.32	1299	3.0
Tanzania	21.02	1027	2.83
USA	21.54	1217	2.90
Others	155.37	7068	20.89
Total	743.74	42,579	100

   Source: GCEPC Research based on DGCIS data for 2023