India is one of the largest exporters of Gems and Jewellery. The industry plays a vital role in the Indian economy for its role as a major contributor to the total foreign exchange reserves of the country. Based on its potential for growth and value addition, the Government declared gems and jewellery sector as a focus area for export promotion. The Government has undertaken various measures recently to promote investment and upgrade technology and skills to promote ‘Brand India’ in the international market.
The Gems and Jewellery sector plays a significant role in the Indian economy, contributing around 7 per cent of the country’s GDP and 15 per cent to India’s total merchandise exports. One of the fastest growing sectors, it is extremely export oriented and labour intensive. Government of India has declared the Gems and Jewellery sector as a thrust area for export promotion due to its potential for growth and value addition.
India is the hub of the global jewellery market because of its low costs and availability of high-skilled labour and it exports 75 per cent of the world’s polished diamonds. The Indian government presently allows 100 per cent Foreign Direct Investment (FDI) in the sector through the automatic route.
India is deemed to be the hub of the global jewellery market because of its low costs and availability of high-skilled labour. India is the world’s largest cutting and polishing centre for diamonds, with the cutting and polishing industry being well supported by government policies. Moreover, India exports 95 per cent of the world’s diamonds, as per statistics from the Gems and Jewellery Export promotion Council (GJEPC).
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 the Government of India.
India’s gems and jewellery market size was at US$ 78.50 billion in FY21. Growth in exports is mainly due to revived import demand in the export market of the US and fulfilment of orders received by numerous Indian exhibitors during the Virtual Buyer-Seller Meets (VBSMs) conducted by GJEPC.
India’s gems and jewellery exports reached US$ 39.14 billion in 2021-22, a 54.13% rise from the previous year. In April 2022, India’s overall gems and jewellery exports were at US$ 3.23 billion. The Government of India is aiming at US$ 70 billion in jewellery export in the next five years (until 2025), up from US$ 35 billion in 2020.