India's gems and jewelry exports hit 3-year low: Here's why
India's gems and jewelry exports have seen a significant downturn, reaching a three-year low in FY24. According to the commerce ministry's Niryat portal, these exports were valued at $32.71 billion, down from $37.96 billion in FY23 and $38.94 billion in FY22. The sharp drop is largely attributed to reduced global demand, particularly from major markets such as China and the US.
Pandemic and global demand impact on exports
The COVID-19 pandemic has significantly impacted India's gems and jewelry sector, one of the country's major export categories. Strict global lockdowns to curb virus spread led to exports plummeting to $3.86 billion in FY19, and $4.32 billion in FY20. Despite an ambitious export target of $40 billion set by the Gems and Jewelry Export Promotion Council (GJEPC) for FY24, actual figures fell short due to these challenges.
Geographical distribution of India's gems and jewelry exports
In FY24, India's gems and jewelry exports to North America were valued at $10 billion, while those to North East Asia, comprising China, stood at $7 billion. These figures represent a decrease from $13 billion and $9 billion, respectively in FY23. However, there was an increase in exports to West Asia and North Africa, including the significant market UAE, which rose to $9 billion in FY24 from $7 billion the previous year.
Trade deficit decreases amid export challenges
Despite the downturn in gems and jewelry exports, India's overall trade deficit decreased to $78.12 billion in FY24, from $121.62 billion in FY23. The World Trade Organization (WTO) anticipates a gradual recovery in global goods trade during 2024, following a slump due to high energy prices and inflation. The WTO forecasts a 2.6% increase in the volume of global merchandise trade this year, and a further rise of 3.3% in 2025.
