The Indian Gems and Jewellery sector is one of the largest in the world, contributing around 29% to the global jewellery consumption. The sector employs over 4.64 million employees and is home to over 300,000 gems and jewellery players. The sector contributes 7% to the Gross Domestic Product (GDP) of the country.
In November and December, gems and jewellery exports achieved pre-COVID peaks as demand picked up in all major markets, including the US, where Thanksgiving Day spending improved by almost 22%, according to GJEPC. India is the most preferred country in terms of gems and jewellery export. The overall net export of gems and jewellery stood at US$ 29.01 billion in FY20, whereas import was at US$ 26.05 billion during same period. India exported US$ 18.66 billion worth of cut and polished diamonds in FY20P. It contributed 64% to the total gems and jewellery export. India’s top export destinations for gems and jewellery are US, Europe, Japan and China. US accounts for nearly one-fourth of the country’s total gems and jewellery export. India is the world’s largest centre for cut and polished diamonds and export 75% of the world’s polished diamonds. As per reports 14 out of the 15 diamonds sold in the world are either polished or cut in India. India exported cut and polished diamonds worth US$ 18.66 billion in FY20; this accounted for 52.4% of the total gems and jewellery export.
India is the world’s second largest gold consumer. India’s demand for gold reached 690.4 tonnes in 2019. The Government has permitted 100% Foreign Direct Investment (FDI) in the sector under the automatic route. The Rs. 250,000 crore (US$ 35.77 billion) household jewellery industry is probably going to get a major lift through the Government’s decision for FDI in retail. The Bureau of Indian Standards (BIS) has revised the standard on gold hallmarking in India from January 2018 to include a BIS mark, purity in carat and fitness, as well as the unit’s identification and the jeweller’s identification mark on gold jewellery. The move is aimed at ensuring stringent quality check on gold jewellery. The Government has made hallmarking mandatory for gold jewellery and artefacts and a period of one year is provided for its implementation (till January 2021).
Road Ahead
The growth is significant in terms of Exports & the demand cycle to pick-up going forward.
The Domestic Jewellery demand is yet to pick-up, Gold & Gold jewellery are seen as investment in India.
BENEFICIARIES : TITAN COMPANY, RENAISSANCE GLOBAL LTD, VAIBHAV GLOBAL, RAJESH EXPORTS, THANGAMAYIL, GOLDIAM INTERNATIONAL
