India’s Gem, Jewelry Exports Fall 3%

Mumbai--Hampered by weak global demand, India saw exports of gems and jewelry fall for the fifth consecutive year in fiscal year 2016, which ended in March.

According to figures released this week by India’s Gem & Jewellery Export Promotion Council (GJEPC), India’s exports in the sector fell 3 percent year-over-year in FY 2016, from $39.98 billion to $38.6 billion.

Exports of polished diamonds fell most sharply, declining 14 percent and mirroring the declines recorded by the world’s other main diamond trading centers, Antwerp and Israel. The GJEPC noted this was the first time in the last six years that polished diamond exports dropped below the $20 billion mark in India.

Gold jewelry exports dropped 13 percent while colored stone exports were down 4 percent.

Exports of other materials, including pearls, synthetic stones and costume and fashion jewelry, were up 50 percent.

At a press conference held Thursday in Mumbai, GJEPC Chairman Praveenshankar Pandya noted that weak international demand and high rough diamond prices have impacted profitability for the country’s diamond manufacturers, while increasing financial costs and inventory-carrying costs have become “unbearable.”

He said that interest subvention is the “need of the hour.”

In addition, India’s Union Commerce & Industries Ministry is considering recommendations made by the GJPEC with respect to the availability of duty-free gold, and the GJEPC is preparing a “job work” draft policy to present to the government that would make it better able to compete with China in diamond manufacturing.

The organization also said it is collaborating with the world’s largest diamond miners, De Beers, Alrosa and Rio Tinto, on a generic diamond promotion campaign to help buoy interest in the category.

Gem and jewelry exports accounted for 15 percent of India’s total exports in the FY 2016, making it one of the leading exports for the nation of 1.25 billion people.

However, the GJEPC noted that FY 2016 marked the fifth consecutive year in which gem and jewelry exports have fallen.

India’s three biggest markets for gems and jewelry were the United Arab Emirates, accounting for 32 percent of gross exports; Hong Kong (28 percent) and the United States (22 percent).