Gems and jewellery exports account for more than $40 billion (about Rs 2.84 trillion) annually, employing more than 5 million people across the country.
The industry has a huge potential to grow and it is the aim of the ministry to boost exports to $75 billion (about Rs 5.32 trillion) by 2025, it said in a statement.
It said that one such CFC is being set up in Kolkata for gems and jewellery artisans.
"This CFC will benefit one lakh artisans engaged in the manufacturing of handmade jewellery in and around Bowbazar, a major jewellery hub of Kolkata," the ministry said.
The centre will enhance the productivity and quality of products, especially the small gem and jewellery units, it added.
Apart from introducing trade-friendly policies for the sector, the ministry is also facilitating the industry through creation of infrastructure in the form of CFCs.
A jewellery CFC is also being set up at Coimbatore and is expected to be completed by March 2020.
Similar centres have already been set up at major diamond clusters in Gujarat like Amreli, Palanpur, Visnagar and Junagadh.
"The objective of setting up CFCs is to give the small and medium jewellery manufacturing units access to a common pool of high-end and capital-intensive state-of-the-art machinery/equipment which is otherwise unaffordable for individual small and medium jewellery manufacturers," it said.
The SME (small and medium enterprises) units located in small towns like Coimbatore, Hyderabad, Jaipur, Rajkot and interior villages are still operating with old technology, and this has affected the quality of the finished goods produced, it added.
"The artisans/goldsmiths in these places undertake the work on job-work-basis from wholesale jewellery manufacturer/retail jewellers. They use out dated technology to manufacture the jewellery," it said.
Usage of technology like casting technology, finishing techniques like tumbling and magnetic polisher are being used only in a few of the units, it added.
"The CFCs will empower the trade in this sector and increase overall productivity, yield and timely delivery," it said.