Modest growth in gem exports

US slowdown, rising Re take shine off precious stones.

The country's gem and jewellery exports grew 2.74 per cent to Rs 77,180 crore in 2006-07, according to the Gem and Jewellery Export Promotion Council (GJEPC).

Gold jewellery exports rose 34.55 per cent to Rs 23,516 crore in the last financial year. Coloured gemstone exports rose 6.08 per cent to Rs 1,112 crore.

"Our target was to achieve exports worth $18 billion (Rs 77,200 crore), but in the circumstances, the performance has been satisfactory against the background of high volatility in gold prices and cooling of global economy," said Sanjay Kothari, chairman, GJEPC.

Cut and polished diamond exports witnessed a fall of 7.83 per cent because most of the loose diamonds were used as raw material for making jewellery for exports, said Vasant Mehta, vice-chairman, GJEPC.

Cut and polished diamond segment accounts for 80 per cent of the country's gem and jewellery exports, followed by gold jewellery and coloured gemstone.

The overall growth was modest, as the sector had to face serious competition from luxury goods segment.

Cooling down of the US economy, the world's largest consumer, also dented exports.

Imports of gem and jewellery in 2006 (Jan-Dec) declined 13.9 per cent to $12.65 billion (Rs 52,800 crore).

Rise in gold prices, coupled with the rupee's appreciation against the dollar, resulted in narrowing of profit margins leading to the fall in imports.

The rupee has gained 1.3 per cent since the beginning of this month and 2.32 per cent in 2006-07.