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India
Trump’s Tariff: US President Donald Trump’s 27% tariff on the gems and jewellery industry will disrupt the sector, as the US is one of India’s major export destinations. The US accounts for nearly one-third of India’s USD 32 billion in gem and jewellery exports. With these new tariffs, products like cut and polished diamonds, which previously faced no duty, will now attract a 27% tariff. Gold and platinum jewellery will face a 32-34% duty, while silver jewellery could be taxed as high as 40.5%. Lab-grown diamonds and imitation jewellery will also see significant tariff hikes, going up to 38%.
Impact on Major Sectors in Indian Jewellery Exports
According to Ramit Kapur, Managing Director of GSI India, the tariff hike will affect major categories like cut and polished diamonds and studded gold jewellery, which make up a large share of exports. However, he added, “Despite the challenges, high-value studded jewellery will remain resilient, as discerning US buyers prioritize quality, craftsmanship, and certification—areas where India excels.” He emphasized that pricing and competitiveness would be pressured, requiring Indian manufacturers to adapt quickly.
Kapur pointed out that demand for studded jewellery remains strong. However, the tariff change calls for swift action from policymakers and industry leaders to ensure India maintains its leadership in the global jewellery market.
Concerns Over Competitive Landscape and Global Trade Relations
Rajesh Rokde, Chairman of the Gem and Jewellery Council of India (GJC), said, “Tariffs are more than economic measures; they redefine the dynamics of trade partnerships.” He acknowledged the challenges the sector faces due to its reliance on delicate global collaborations. Rokde emphasized that the industry would need to navigate the changing cost structure and reassess its position in the competitive global landscape.
On the other hand, Saurabh Gadgil, CMD of PNG Jewellers, argued that domestic businesses would not be affected because India does not import jewellery from the US. He noted that the tariff hike may hurt the US economy, as it imports many goods from Asia that will now become costlier, potentially leading to inflation and slower growth. Gadgil said, “More importantly, this policy will affect the entire world, and not just the United States. Thus, reciprocal reactions are awaited, and Indian players need to see how this unfolds in the days to come.”
Impact on Small Businesses and the Need for Quick Action
Experts warn that Indian exporters, especially small businesses, could lose market share in the US to countries not facing these duties. They urge quick action from Indian policymakers to safeguard the country’s leadership in the global gems and jewellery trade. If not addressed promptly, these new tariffs could damage the competitiveness of India’s exports to the US market.
(With Inputs From ANI)
