Decline in Indian diamond exports

1. India has long been one of the world’s leading exporters of diamonds and jewellery, but recent years have seen a sharp decline in this glittering trade.
2. In FY25 (until February 2025), India's gems and jewellery exports reached Rs. 2,17,148 crore (US$ 25.73 billion). 
3. India is the sixth-largest exporter of gems and jewellery globally, contributing about 4.3% of the world's total exports.
4. In 2022, India ranked first among the top exporters in cut & polished diamonds, and second in gold jewellery, silver jewellery and lab-grown diamonds.

Current Export and Import Trends

1. Diamond exports fell by nearly 15% in FY25.
2. Lab-grown polished diamond exports dropped by 7.7%.
3. Gold jewellery exports fell by 2%.
4. Total gems and jewellery exports declined by 9.8%.
5. Imports of rough diamonds dropped by 22.6%.
6. Imports of rough lab-grown diamonds fell by 25.1%.
7. Total imports in the sector dropped by about 10%.

Why Is the Industry Struggling?

1. Global demand is weak post-pandemic.
2. Economic slowdown in the US and China.
3. US imposed high tariffs during Trump’s rule (called “Liberation Day” tariffs).
4. Sanctions on Russian diamonds disrupted supply.
5. Surat’s diamond factories shut down; many workers were laid off.

 Any Positive Signs?

1. Gold jewellery exports are showing some growth.
2. Pause in US tariffs gave temporary relief.
3. Some Indian exports like smartphones and pharmaceuticals got exemptions.

What Lies Ahead?

1. US jewellery market may grow only 5% in 2024, not enough to boost exports.
2. Lab-grown diamond demand is weak; natural diamonds are preferred more.
3. Indian exports may struggle unless global demand improves.

What Can Help the Industry?

1. Industry wants government support for marketing natural diamonds.
2. Need campaigns to promote Indian gems abroad.
3. Help is needed for small-scale units and diamond workers.
4. Industry demands lower taxes on diamond exports and jewellery.
5. Here’s the table directly in chat, neatly formatted for easy use:

Category	Type	Value (₹ crore)	YoY Change (%)
Diamonds	Export	1,12,411	-14.9%
Polished lab-grown diamonds	Export	10,716	-7.7%
Gold jewellery	Export	94,938	-2.0%
Total gems and jewellery exports	Export	2,41,090	-9.8%
Rough lab-grown diamonds	Import	7,299	-25.1%
Rough diamonds	Import	91,355	-22.6%
Total gems and jewellery imports	Import	1,65,819	-10.1%

Export Destinations

1. India exports gems and jewellery to USA, Hong Kong, UAE, Belgium, Israel, Thailand, Singapore, UK, Netherlands, Japan, France , Botswana etc.
2. USA is the largest importer of Indian jewellery:
   • US$ 14.5 billion in 2021–22 (up from US$ 8.7 billion in 2020–21)

3. Hong Kong and UAE are also major buyers:

   • Hong Kong: US$ 9.3 billion
   • UAE: US$ 5.7 billion
   • Together they contributed ~38% of total exports

4. Other countries showing strong growth:

   • Israel: US$ 1.5 billion
   • Thailand: US$ 1.2 billion
   • Netherlands: US$ 694.6 million
   • Growth over 60% compared to 2019–20

5. Reasons for growth:

   • Reopening of the India Jewellery Exposition (IJEX) in Dubai
   • New export agreements with UAE, Australia, Israel, UK, Canada, etc.

Government Initiatives

1. Gold Monetization Scheme revamp to attract investment.
2. Import duty reduced:
   • Gold: duty cut
   • Cut & polished diamonds: from 7% to 5%
3. Mandatory hallmarking implemented.
4. Govt provides up to 90% support for:
   • Production centers
   • Design centers
   • Testing labs
   • Plug & play infrastructure
   • Marketing hubs and exhibitions (up to 80% project cost)
5. Extension of Emergency Credit Line Guarantee Scheme (ECLGS) till March 2023.
6. Over 90% of units in the sector are MSMEs.
7. New initiatives focus on:
   • Increasing value through patented designs
   • Promoting lab-grown diamonds
   • Diversifying exports and trade with new countries
   • GJEPC arranges trade shows and buyer-seller meets to promote Indian goods

India’s gems and jewellery industry, once a global leader, is now facing significant headwinds due to declining global demand, high tariffs, and disrupted supply chains. Despite a fall in exports and imports, the sector still holds strategic importance for India’s economy—contributing substantially to GDP, employment, and export earnings.

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