While high inflation in the U.S. has begun impacting India’s exports of gem & jewelley, the Comprehensive Economic Partnership Agreement (CEPA) between India and UAE is likely proving beneficial for exports.
In December 2022, the overall gem & jewellery exports witnessed a decline of 11.25% to ₹19,432.88 crore (declined 18.9% in dollar terms to $2,356.70 million) compared with for the same period in the previous year.
However, the total gross export of plain gold jewellery grew 21.31% in the same month to ₹2,369.74 crore (10.97% increase to $287.46 million), according to data released by the Gem & Jewellery Export Promotion Council (GJEPC).
Plain gold jewellery exports from India for April – December 2022, grew 20.98% to ₹24242.91 crore, the data showed.
For the cumulative year-to-date period of April–December 2022, the overall gross exports of gems & jewellery witnessed growth of 6.28% to ₹227,534.50 crore (declined 0.73% to US$ 28,608.22 million) compared with the same period last year.
“The overall exports of gem & jewellery during April-December 2022 show positive trend but December export figures reflect the global headwinds faced by the gem & jewellery industry in terms of inflation and talk of downturn in U.S.,” said Vipul Shah, Chairman, GJEPC.
“However, it is to the credit and enterprise of the Indian gem & jewellery exporters that they have been able to perform even in this challenging scenario. The commissioning of India-UAE CEPA has resulted in exponential growth in exports of plain gold jewellery to make up for the gap in exports to key markets such as the U.S. and Hong Kong,” he said.
“Overall exports for [April to December] show positive growth of 6.28% in rupee terms. Plain gold jewellery exports have witnessed positive double-digit exports growth of around 21% in both December 2022 as well as the [9-month] period,” he added.
For the period of April–December 2022, the overall gross exports of Cut & Polished diamonds (CPDs) declined 1.24% to ₹132,075.47 crore (fell 7.67% in dollar terms to $16,625.45 million).
“The Ukraine-Russia conflict has started to affect the Cut & Polished Diamond exports that has witnessed 40% decline in rough diamond import from Russia in six months from March 2022,” GJEPC said.
“The diminishing imports in the first 6 months of this fiscal year has resulted in overall decline in cut & polished diamond and overall gem & jewellery exports in the month of December. The zero-Covid policy and the recent withdrawal of the same has also affected negatively the consumer demand of diamond jewellery in China,” it added.
In December 2022, the overall gross export of Cut & Polished diamonds declined 21.5% to ₹10,472.92 crore (declined 28.25 % to $1,270.36 million).
