New Delhi, Sep 16 (NationPress) India’s total gross exports of gems & jewellery have witnessed a remarkable 5.12% increase, reaching $2.12 billion (Rs 18,529.08 crore) in August this year, compared to $2.01 billion (Rs 16,896.04 crore) during the same month last year, as per data from the Gems and Jewellery Export Promotion Council (GJEPC) released on Tuesday.

The main driver behind this growth is the proactive approach of Indian exporters aiming to mitigate the impact of US tariff threats. Additionally, beneficial Free Trade Agreements (FTAs), like the India-UAE Comprehensive Economic Partnership Agreement (CEPA), along with reduced import duties on raw materials, have significantly contributed to this positive trend, as indicated by the GJEPC statement.

In contrast, overall gross imports of gems & jewellery amounted to $1,471.85 million (Rs 12,887.18 crore) in August, marking only a 0.77% rise from $1,460.56 million (Rs 12,253.84 crore) during the same period last year. This slight uptick reflects a consistent demand for raw and semi-finished products within the country, supporting production for the upcoming international holiday season and domestic festive needs.

The total export of cut & polished diamonds saw a decline of 6.29%, totaling $972.29 million in August, down from $1,037.59 million the previous year. This downturn can be linked to a growing preference for yellow metals in the US and Europe, where sluggish spending on luxury goods has reduced overall demand, according to the GJEPC.

Retailers in major markets are experiencing a downturn in sales, leading to increased unsold inventory and slowing new purchases. The rising global interest in lab-grown diamonds, known for being environmentally friendly and cost-effective, has also taken a bite out of the demand for natural diamonds.

Interestingly, plain gold jewellery exports surged by over 63%, reaching $419.51 million in August, compared to $256.99 million in the same month last year. This outstanding growth was bolstered by strong demand in key markets, particularly the Middle East and the US, fueled by festive and wedding purchases, significantly aided by the India-UAE CEPA.

The global consumer trend towards lightweight, everyday wear has stimulated orders, alongside international retailers building stock in anticipation of festive and wedding buying later this year. Furthermore, government policies like customs duty reductions and trade facilitation have enhanced the competitiveness of Indian exports in global markets.

Colin Shah, MD of Kama Jewellery, commented: “The Indian gems & jewellery sector is swiftly adapting to the uncertainties brought on by US tariffs. The strong performance in August demonstrates the exporters’ urgency to engage in trade early and avoid tariff impacts.”

“At the same time, new opportunities arise from trade agreements such as those with the UAE, as consumers increasingly seek sustainable, premium, and custom jewellery. Despite challenges like high gold prices and market volatility, we expect the upcoming festive and wedding season to rejuvenate the sector,” he added.