India's gem and jewellery exports witnessed a decline of 6 per cent year-on-year, reaching USD 4.27 billion during April-May 2026, according to the Gem and Jewellery Export Promotion Council (GJEPC). The downturn was primarily driven by a steep drop in plain gold jewellery shipments, which faced headwinds from gold supply constraints and rising input costs. However, silver jewellery exports emerged as a standout performer, surging by over 172 per cent.
Factors Behind the Decline
The gems and jewellery sector has been grappling with multiple challenges, including elevated gold prices, limited availability of gold for export production, and regulatory bottlenecks that have hampered gold supply through banking channels. These factors collectively weighed on the overall export performance.
In rupee terms, India's overall exports grew by 3.99 per cent, despite a 6.03 per cent decline in dollar terms. The sharp fall in plain gold jewellery exports was a major contributor to the dollar-denominated decline, with shipments dropping 40.11 per cent year-on-year to USD 635.95 million from USD 1.06 billion in the same period last year.
Concerns Over Plain Gold Jewellery
The GJEPC highlighted that plain gold jewellery exports remain a significant area of concern, largely due to tighter gold imports that have constrained the availability of the precious metal for export-oriented manufacturing. The industry body has taken up the matter with the government and expressed hope for a positive resolution.
The impact of these constraints is evident in gold consumption for export production, which declined to an estimated 11 tonnes during April-May 2026 from around 14 tonnes in the corresponding period last year, representing a reduction of nearly 21.4 per cent.
Silver Jewellery Emerges as Bright Spot
Amid the weakness in gold jewellery exports, silver jewellery shipments witnessed a remarkable surge of over 172 per cent, reaching USD 365.77 million. In rupee terms, silver jewellery exports jumped 199.91 per cent to Rs. 3,439.19 crore from Rs. 1,146.73 crore. The GJEPC emphasised that strengthening exports is critical to supporting India's balance of payments position and addressing the current account deficit.
Impact of Rising Gold Prices
The average gold price during April-May 2026 increased to USD 4,723.88 per troy ounce from USD 3,242.48 per troy ounce in April-May 2025, marking a year-on-year increase of 45.69 per cent. Exporters continue to bear the burden of higher input costs, while the Duty Drawback rates have not been revised accordingly, adversely affecting the competitiveness and margins of jewellery exporters.
The data and insights were provided by the Gem and Jewellery Export Promotion Council (GJEPC).
