India's Gems and Jewellery Exports Plummet 15.81% in May Amid Global Uncertainty

Strategic Insights -

The Indian gems and jewellery sector faced a sharp decline in exports in May, with a 15.81% drop to $2.26 billion (Rs.19,260.81 crore), attributed to growing global economic uncertainty, trade barriers, and slowing consumer demand in key markets. The fall is being attributed to the announcement of tariffs by the US and the rise of sustainable and cost-effective lab-grown diamonds. The exports of cut and polished diamonds, the sector's largest export segment, plunged 35.5% year-on-year to $949.7 million (Rs.8,089.81 crore). The sector's broader product portfolio also suffered, with silver jewellery exports down 17.59% and coloured gemstones registering a marginal 1.13% dip.

Key Takeaways:

  • India's gems and jewellery exports declined 15.81% in May to $2.26 billion (Rs.19,260.81 crore) due to global uncertainty and tariffs imposed by the US.
  • Exports of cut and polished diamonds fell 35.5% year-on-year to $949.7 million (Rs.8,089.81 crore).
  • Polished lab-grown diamonds saw a 32.76% decline to $80.9 million (Rs.689.71 crore).
  • Gold jewellery exports rose 17.24% to $997.5 million (Rs.8,482.61 crore) due to increased demand for gold as a safe-haven asset.
  • Total gems and jewellery imports dropped 13% to $1.69 billion due to weaker downstream demand and delayed orders.
  • The industry expects trade activity to remain volatile in the coming months due to ongoing geopolitical instability.
  • Gold remains a bright spot, with international gold prices reaching a historic high of $3,435 per ounce in June.
  • Domestic gold jewellery sales remain muted due to consumers limiting purchases to essential needs.
  • Investment demand for gold bars and coins continues to be strong, with gold-backed lending growing nearly 120% year-on-year to Rs.2,230 billion as of April.

Statistics:

  • The decline in gems and jewellery exports in May was 15.81% to $2.26 billion (Rs.19,260.81 crore).
  • Exports of cut and polished diamonds in May were $949.7 million (Rs.8,089.81 crore).
  • Polished lab-grown diamonds exports in May were $80.9 million (Rs.689.71 crore).
  • Gold jewellery exports rose 17.24% to $997.5 million (Rs.8,482.61 crore) in May.
  • Total gems and jewellery imports in May were $1.69 billion.
  • Gold-backed lending grew nearly 120% year-on-year to Rs.2,230 billion as of April.
  • International gold prices reached a historic high of $3,435 per ounce in June.

Sources:

  • Gems and Jewellery Export Promotion Council (GJEPC)
  • World Gold Council
  • UBS
  • The Indian Awaaz