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India's jewellery exports are set to decline sharply due to US tariffs

Industry officials warned that India's gems and jewelry industry, worth $32 billion, is bracing itself for a steep drop in exports due to the high U.S. import tariffs.

The United States has imposed a reciprocal 26% tariff on India. This is a blow for the hopes that South Asia had of being relieved under President Donald Trump’s global trade policy.

Colin Shah, managing Director of Kama Jewelry - one of India's largest diamond jewellery manufacturers - said that the tariff was higher than expected. "It's quite severe and will impact exports."

India is the largest hub in the world for diamond polishing and cutting, with nine out of 10 diamonds processed worldwide.

India exports gems and jewelry worth $32 billion annually to the United States, which accounts for almost $10 billion.

India exports more gems and jewelry to the United States than it does engineering or electronic goods. The industry is responsible for millions of jobs in South Asia.

Exports fell 14.5% in 2023-24 (April-March) due to a weakening demand in China.

Shah suggested that a long-term bilateral deal with the United States might help to soften the blow.

India and the United States have begun talks to reach a trade agreement as soon as possible.

We're pretty optimistic that India will be able to land a deal with the U.S. within the next few weeks. We just have to keep pushing through the tough phase for another few months," said Shaunak Parikh. Vice chairman of GJEPC. (Reporting and editing by Rajendra J. Jadhav)

(source: Reuters)