Conflict in West Asia might further hurt jewelry exports in Q1

The Middle East crisis is anticipated to have an effect on the export of gems and jewelry during the April–June quarter of current fiscal year, as the demand is anticipated to decline, the industry’s export promotion organization said on Monday.

India’s largest export markets for jewels and jewelry are the Middle East and the United States. 35–40% of India’s exports of jewelry and diamonds, which totaled $32.2 billion in 2023–24—a 14.45% decrease from the previous year—come from this area.

Additionally, India exports 35–40% of its gems and jewelry to the US.

According to the Gems and Jewellery Export Promotion Council (GJEPC), the sector’s cut and polished diamond exports fell 27.58% to $15.7 billion, mostly as a result of a disruption in the supply of raw diamonds from Russia as a result of sanctions. Russia’s raw diamond supplies have dried up over the last 18 months, leaving the industry to rely on other suppliers like Antwerp, Israel, and the Middle East.

Chairman of GJEPC Vipul Shah said, “GJEPC is discussing with global diamond miners to increase investments in enhancing generic promotion of diamonds and diamond jewelry in the US, China, Middle East, including India.”

The free trade agreements with the United Arab Emirates (UAE) and Australia have helped plain gold jewelry exports, which increased 61.72% to $ 6.7 billion in the most recent fiscal year, but polished diamond exports have suffered.

Exports of plain gold jewelry to the UAE increased by 107.2% in FY 2023–24, totaling $4.5 billion. India exported more than 85% of its simple gold jewelry to the United Arab Emirates and Bahrain. Additionally, Australia saw a 37% increase in exports of simple gold jewelry.

The whole amount of plain and studded gold jewelry exported increased 16.75% to $11.2 billion in the previous fiscal year.

“GJEPC made concentrated efforts to explore new markets with delegations to Vietnam and Cambodia with the aim of tapping and penetrating new markets. To boost exports, a mission to Latin American nations is now scheduled for May.

GJEPC is taking part in fifteen international exhibitions this year, spread over various regions of the globe. The biggest jewelry exhibition in the US will be at the end of May, which Shah said should signal the beginning of the recovery in US exports.