In the fiscal year 2023-24 (FY24), India witnessed a remarkable surge in jewellery exports, particularly in the category of plain gold jewellery. Despite facing various challenges, the industry showed resilience and registered substantial growth, marking a significant milestone for India’s gem and jewellery sector.
Key Growth Figures
The Gems & Jewellery Export Promotion Council (GJEPC) reported an impressive 61.72% increase in exports of plain gold jewellery, amounting to $6,792.24 million in FY24, compared to $4,199.96 million in the previous year. Overall, total gold jewellery exports, including both plain and studded varieties, grew by 16.75% during the fiscal year.
Challenges Faced by the Industry
Despite the stellar performance, the industry encountered several challenges, including economic downturns in major export markets and geopolitical uncertainties, which adversely affected demand.
Key Markets and Growth Drivers
The United Arab Emirates (UAE) and Bahrain emerged as the primary destinations for India’s plain gold jewellery exports, collectively accounting for over 85% of the total exports in this category. Notably, the UAE witnessed a remarkable growth rate of 107.2%, with exports reaching $4,528.66 million in FY24. Australia also experienced a substantial surge of 37% in plain gold jewellery exports, attributed in part to the India-Australia Economic Cooperation and Trade Agreement (ECTA). Platinum gold jewellery exports exhibited robust growth, soaring by 449.16% and reaching $163.48 million in FY24. Additionally, coloured gemstone exports recorded a notable increase of 14%, amounting to $478.71 million.
Impact of Trade Agreements
The implementation of the India-UAE Comprehensive Economic Partnership Agreement (CEPA) played a pivotal role in bolstering plain gold jewellery exports to the UAE, underscoring the significance of favorable trade agreements in facilitating export growth.
Efforts to Enhance Exports
The GJEPC has been actively collaborating with the government to advocate for favorable policies in forthcoming trade agreements with key trading partners, including GCC countries, Canada, UK, and EU.
The council’s proactive engagement is expected to yield positive outcomes, further stimulating gem and jewellery exports to these nations in the foreseeable future.
India’s Gold Storage Status and Initiatives
India boasts the 9th largest gold reserves globally, with 820.625 metric tons as of April 2024. The majority of these reserves are stored in the vaults of the Reserve Bank of India (RBI), supplemented by holdings in commercial banks.
Various schemes, such as the Gold Monetization Scheme and the Sovereign Gold Bond Scheme, have been introduced to encourage responsible gold ownership and investment.
Contributions to the Economy and Employment
The Indian gem and jewellery industry significantly contribute to the country’s GDP, accounting for approximately 7%, and provide employment opportunities to over 4.64 million workers. Government initiatives, including the establishment of jewellery parks, skill development promotion, and financial assistance to exporters, aim to bolster the sector’s growth and sustainability.
Outlook
Despite the challenges faced, India’s jewellery exports, particularly in the plain gold jewellery segment, have demonstrated resilience and growth in FY24. With continued focus on favorable trade policies and industry collaboration, the gem and jewellery sector is poised for sustained expansion and global competitiveness in the years ahead.