Indian Gems & Jewellery exports witnessed a contraction of 23.28% in July 2024; imports declined by 16.59%

Overall Market Trend

The trendline for Indian gems & jewellery has been on a continuous downwards trajectory and this is majorly owing to the global unrest-induced dampening of consumer demand. With the looming uncertainty of unprecedented geo-political developments and its impact on global economy, consumer markets across the globe are taking cautious buying decisions.

Imports

In terms of the overall imports of Gems & Jewellery for July 2024, the sector has witnessed a decline of 16.59%, which stood at USD 1404.62 million (INR 11738.92 crores), as compared to USD 1683.96 million (INR 13831.79 crores) for the same period last year. This dip is temporary in nature and will bounce-back much strongly as the country nears the onset of Indian festive season.

Cut and Polished Diamonds

The overall gross export of Cut & Polished diamonds saw a decline of 22.71% in July 2024, standing at USD 907.67 million (INR 7588.23 crores) compared to USD 1174.41 million (INR 9646.95 crores) for the corresponding period of the previous year. The steep decline in diamond trade with China due to its weak market scenario has been of a significant blow to the Indian cut and polished diamonds market, with about 10% to 15% of the actual exports happening between the two countries. In terms of the overall gross imports of Cut & Polished diamonds, it saw a decline of 50.65% at USD 81.94 million (INR 684.83 crores) when compared to USD 166.03 million (INR 1364.06 crores) for the same period last year.

Rough Diamonds

Gross imports of rough diamonds stood at USD 4305.70 million (INR 35924.43 crores) in July 2024, showing a decline of 15.78% when compared with the imports for the same period last year, which stood at USD 5112.38 million (INR 42005.1 crores). This downfall can be understood as the chain reaction to the decline in overall exports of Indian Gems & Jewellery and, specifically, cut and polished diamonds. As India hails as the largest diamond processing hub, there is a sense of gloominess in the sector, and the dip in the import of rough diamonds is one of the reasons.

Polished Lab Grown Diamonds

The total gross export of Polished Lab Grown Diamonds during July 2024 stood at USD 94.72 million (INR 791.93 crores), showing a decline of 10.21% as compared to USD 105.49 million (INR 866.63 crores) last year. This decline can be attributed to the weak demand in overseas markets supported by falling prices of natural diamonds leading to fluctuations in prices of lab-grown diamonds as well. While lab-grown diamonds as a sector proved promising for India, the fall in exports of finished lab-grown diamonds is due to the overall sluggish demand. However, if the global economy shows some sign of stability, we may see a reinvigoration in international demand by the holiday season.

Gold Jewellery

The total gross export of Gold Jewellery in July 2024 stood at USD 530.38 million (Rs. 4433.02 crores), showing a decline of 12.06% compared to USD 603.12 million (INR 4955.0 crores) for the same period last year. This can be attributed to the slowdown in demand in the global market as gold prices have started to inch higher.

Coloured Gemstones

Provisional gross export of Coloured Gemstones during July 2024 stood at USD 114.41 million (in INR 954.92 crores) witnessing a decline of 25.1% compared to USD 152.75 million (INR 1255.6 crores) for the same period last year. This can be attributed to the subdued demand in the international markets.

Industry Comment

Commenting on the same, Mr. Colin Shah, MD, Kama Jewelry, said, “The gems & jewellery industry has been going through uncertain times with muted trade activities for the past year and a half. The re-emergence of geo-political tensions in the Middle East has again turned the scenario towards uncertainty. Additionally, 60+ countries in the world will undergo elections this year, which may put restrictions on trade activities for the time being, thereby affecting the demand. Therefore, we need to monitor the global scenario closely, which will provide a clear view of the course of trade activities for the remainder of the year. With regards to the domestic market, we are optimistic about witnessing a fruitful festive season ahead supported by robust demand as buyers will certainly make the most of the low customs duty on gold, silver and platinum announced in the recently concluded Union Budget, which will revive the trade activities in the country.”