India’s gems and jewellery export sector—which is one of the largest in the world—contributed ~27% to the global jewellery consumption in 2019. Market size of the global gems and jewellery sector is likely to expand to US$ 103.06 billion between 2019 and 2023. India’s gems and jewellery exports are expected to reach US$ 100 billion by 2025.
In FY21*, exports of gems & jewellery stood at US$ 21.89 billion. In February 2021, exports of gems & jewellery stood at US$ 2.64 billion.
In September 2020, the US was the largest country (at 44%) to import gems and jewellery (US$ 938.54 million) from India, followed by Hong Kong (~33%) and the UAE (~13%).
In FY21*, cut and polished diamonds accounted for ~65% of the total gems and jewellery exports, with India exporting 75% of the world’s polished diamonds.
According to Gem and Jewellery Export Promotion Council, between April 2020 and December 2020, gold bars accounted for ~6.8% (US$ 678.77 million) and gold jewellery at ~1.8% (US$ 181.49 million) of the total gems and jewellery imports in India. As per the World Gold Council (WGC), India’s gold demand stood at 446.4 tonnes in 2020.
The Government has permitted 100% FDI in the sector under the automatic route, wherein the foreign investor or the Indian company do not require any prior approval from the Reserve Bank or Government of India. The Government has made hallmarking mandatory for gold jewellery and artefacts and a period of one year is provided for its implementation.
As per Union Budget 2021, the Gem and Jewellery Export Promotion Council has proposed a reduction in import duty on cut and polished diamonds to 2.5%, from the existing 7.5%, in order to double exports of gems & jewellery to US$ 70 billion by 2025.
Cumulative FDI inflows in diamond and gold ornaments in India stood at US$ 1,190.47 million between April 2000 and December 2020 according to Department for Promotion of Industry and Internal Trade (DPIIT).
*between April 2020 and February 2021