Bengaluru: The Indian gems and jewellery industry, which contributes about 10% to the country’s merchandise exports, is preparing for potential US tariffs by expanding into alternative markets like Latin America, Vietnam, and Saudi Arabia. Industry leaders told ET that they are visiting these markets, seeking opportunities to mitigate the impact and sustain export growth.
“We are still very optimistic and confident that the Indian government will protect the industry, and there might not be any tariffs. But if they do come, it is going to significantly impact the industry; nearly half of our business in the US, our largest export market, will be lost,” Gem and Jewellery Export Promotion Council (GJEPC) chairman Kirit Bhansali told ET.
Bhansali was speaking on the sidelines of the four-day India International Jewellery Show (IIJS) in Bengaluru, supported by the Union Ministry of Commerce and Industry. The council has set a target of $70 billion in gem and jewellery exports by 2030, with $35 billion yet to be achieved, the chairman said.
The GJEPC also said the Indian government is actively pursuing free trade agreements with several key countries.
Speaking about other markets, Prism Jewellery CEO and GJEPC member Nirav Bhansali said while China has shown slow demand, a recent Hong Kong trade show indicated renewed interest in natural diamonds. There has also been demand for small diamonds, signalling a gradual resurgence in the sector, he added.
“The UAE market has performed extremely well under the CEPA (Comprehensive Economic Partnership Agreement). In the past three years, we’ve seen 60% growth in gold jewellery exports and 17% growth in diamond jewellery exports. We are now looking at a trade treaty with Australia,” he added.
Back home, the industry remains confident about continued domestic growth at 10%, driven by new organised players entering the space.
According to latest data from the GJEPC, India’s gem and jewellery exports in February totalled $2.42 billion, a 23.49% decline from $3.17 billion a year earlier.
Karnataka Offers Land for Jewellery Park
Karnataka industries minister MB Patil said on Friday that the government is open to providing land for setting up a jewellery park near the Bengaluru international airportto help boost exports. Speaking at the inauguration of the India International Jewellery Show, Patil urged industrialists to take advantage of Karnataka’s export potential and invest in the sector.
Patil said the state ranks first in the country for attracting foreign direct investment and second in GST collection.
