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India's gems and jewellery exports nose dived about 41% year-on-year to $2.3 billion in June, 2013 on account of shortage of yellow metal and limited inventory in domestic market.
In June last year, these exports stood at $4 billion, according to the Gems and Jewellery Export Promotion Council (GJEPC).
"The exports declined drastically in June as there was a shortage of raw-material for jewellery manufacturing. This was because the government had taken steps to curb gold imports," GJEPC Chairman Vipul Shah told PTI.
But, he said, the shortage was a short-term phenomenon and hoped that the industry would get regular raw-material supply.
India is the largest importer of gold which is mainly utilised to meet demand of the jewellery industry.
The major markets for the country's jewellery exports are the US, Europe, Middle-East, Hong Kong and Japan.
In June 2013, there were no outbound shipments of gold medallions and coins, while gold jewellery exports declined 73%. However, silver jewellery exports were up 52% and outward shipments of cut and polished diamonds jumped about 22%.
During April-June 2013, the gems and jewellery exports declined 13.2% year-on-year to $8.5 billion.
India imported around 830 tonnes of gold in 2012-13. To curb demand, the government hiked the import duty on gold thrice in a year and raised it recently by 2%, to 8%. Besides, RBI too, has put restrictions on banks on importing gold.
Gold imports in June are estimated to have fallen to around 31 tonnes, down from 162 tonnes in May and 141 tonnes in April.
High imports strain the Current Account Deficit (CAD), which hit a record high of 4.8% in the 2012-13 fiscal.
CAD occurs when total imports of goods, services and transfers is greater than the exports.
