The gems and jewellery exports have declined by 8.67 per cent to Rs 2,64,130.64 crore in financial year 2017-18, mainly due to drop in demand from the UAE, an industry body said today.
The exports stood at Rs 2,89,207.47 crore in 2016-17, according to data by the Gem and Jewellery Export Promotion Council (GJEPC) of India.
The demand from the UAE declined by 27 per cent to Rs 66,862.98 crore during FY18, compared with Rs 91,458.57 crore in the previous year, on a 5 per cent value added tax (VAT) imposed in the UAE in January, it said.
Major export destinations for the gems and jewellery sector in 2017-18 were Hong Kong with 33 per cent, followed by the UAE with 25 per cent and the US at 23 per cent.
Silver jewellery, coloured gemstones pearls, synthetic stone, costume fashion jewellery and gold medallion were impacted, according to the report.
The exports in the sector was primarily driven by the cut and polished diamonds (CPD) segment, which witnessed an increase of 0.18 per cent to Rs 1,52,961.38 crore in FY18, compared with Rs 1,52,682.59 crore in FY17.
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The total volume of CPD were at 348.60 lakh carats during 2017-18, compared with 322.13 lakh carats in 2016-17.
Meanwhile, the gold jewellery exports registered a growth of 6.71 per cent growth to Rs 62,387.48 crore in FY18, against Rs 58,464.92 crore in FY17, while the exports of silver jewellery decreased by 18.91 per cent to Rs 21,830.76 in FY18, compared with Rs 26,923.25 crore in FY17.
GJEPC vice chairman Colin Shah said the US is the largest consumer of diamonds and jewellery globally and the region is showing an upward trend.
"The US imports 16 per cent of its jewellery from India. We are making efforts to grow the demand for 'India Made' jewellery products in the established markets like the US, Hong Kong and China. We are exploring and penetrating new markets including Iran, Jordan, Turkey, Latin America, Russia and the South East Asia," he added.
GJEPC, he said, is also focused on buyer-seller matching programmes across product categories to boost demand for diamonds, gemstones and jewellery.
"We has spent USD 16 million in promotions of the sector in FY18, which will be further increased in this financial year. With all these efforts, we expect the exports to grow by 10 per cent in FY19," he added.
GJEPC chairman Pramod Agrawal said the gems and jewellery today contributes nearly 7 per cent to the country's GDP and over 15 per cent to the merchandise exports.
"India has become world leader in cut and polished diamond exports, polishing nearly one billion stones each year. With improvement in living standards, the sector is likely to grow at a rapid pace and, hence GJEPC intends to add 3 million more workforce by 2022," he added.