The India-UK free trade agreement finalised on Thursday has come as a big relief for the gem and jewellery exporters, who have seen their business shrinking consistently in last few months with fluid geopolitical developments.
The Gem & Jewellery Export Promotion Council (GJEPC) has been proactively collaborating with the government to ensure that the industry receives the strategic focus and priority it truly deserves.
Kirit Bhansali, Chairman, GJEPC, said jewellery exports to the UK — currently at $941 million — has the potential to touch $2.5 billion over next three years with the duty concessions in place.
The overall bilateral trade between both the country in the gem and jewellery sector is expected to touch $7 billion, he said.
The FTA with UK comes at a time when gems and jewellery exports dipped 14 per cent in June to $1.63 billion against $1.90 billion logged in the same period last year due to economic uncertainties around the US President Donald Trump tariff, which has led to weak demand in key markets.
West Asia crisis
In rupee terms, it dipped 12 per cent to ₹13,979 crore against ₹15,837 crore as the recent geopolitical unrest in the West Asia has further disturbed the global consumption demand, according to the Gem and Jewellery Export Promotion Council data.
On the other hand, imports of gems and jewellery were down 3 per cent to $1.55 billion ($1.60 billion) as the demand in the home ground is stagnant due to high gold prices and economic uncertainties, clubbed with a comparatively dull period for buying gold.
Prithviraj Kothari, Managing Director of RiddiSiddhi Bullions, said with trade routes opening up and economic activity picking up, overall business is expected to grow with the two-way trade witnessing a boost.
While jewellery demand is expected to increase as part of the broader market expansion, it is important to note that consumption patterns in Europe are different and jewellery usage there is comparatively lower, he said.