As of January 2021, India’s gold and diamond trade contributed about 7.5% to India’s Gross Domestic Product (GDP) and 14% to India’s total merchandise exports. The gem and jewellery sector is likely to employ about 8.23 million persons by 2022, from about 5 million in 2020. The Indian Government has made hallmarking of jewellery compulsory from June 2021.
In FY21, exports of gems & jewellery stood at US$ 25.30 billion. In March 2021, exports of gems & jewellery stood at US$ 3.42 billion.
In September 2020, the US was the largest country (at 44%) to import gems and jewellery (US$ 938.54 million) from India, followed by Hong Kong (33%) and the UAE (13%).
In FY21, imports of gems & jewellery stood at US$ 16.49 billion. Imports of gold jewellery recorded US$ 262.25 million from April 2020 to February 2021.
The Government has permitted 100% FDI in the sector under the automatic route, wherein the foreign investor or the Indian company do not require any prior approval from the Reserve Bank or Government of India.
Cumulative FDI inflows in diamond and gold ornaments in India stood at US$ 1,190.47 million between April 2000 and December 2020 according to Department for Promotion of Industry and Internal Trade (DPIIT).
Online sales are expected to account for 1–2% of the fine jewellery segment by 2021–22. Also, the relaxation of restrictions of gold import is likely to provide a fillip to the industry. The demand for jewellery is expected to be significantly supported by the recent positive developments in the industry and the periodic marriage season.