Surat: India's plain gold jewellery exports witnessed a sharp downturn in the first two months of FY27, declining 40.1% year-on-year to US$ 635.95 million during April-May 2026, as soaring gold prices, restricted raw material availability and policy-related bottlenecks weighed heavily on export production.
The steep fall from US$ 1.06 billion in the corresponding period last year has emerged as the biggest concern for the gems and jewellery sector. Industry players said tighter gold imports and disruptions in the banking channel have restricted the availability of gold required for manufacturing export orders.
The impact was also visible in production levels, with estimated gold consumption for export fabrication dropping to 11 tonnes in April-May 2026 from around 14 tonnes in the same period last year, a decline of nearly 21.4%.
“The steep drop in plain gold jewellery exports remains the primary concern for the sector,” said Kirit Bhansali, chairman of the Gem and Jewellery Export Promotion Council (GJEPC). He said the industry has taken up the issue of restricted gold availability with the government and remains hopeful of a favourable resolution to restore supply and support export growth.
While plain gold jewellery struggled, studded gold jewellery exports offered a silver lining, rising 6.7% to US$ 964.02 million during April-May 2026 from US$ 903.37 million a year earlier. Bhansali attributed the growth to India's free trade agreements (FTAs), which have improved market access and enhanced the competitiveness of Indian jewellery in key overseas markets.
The sector is also grappling with increased input costs after the rise in gold import duty from 6% to 15%, which has pushed up the landed cost of gold. Exporters have raised concerns that duty drawback rates have not been revised in line with the higher duty, putting pressure on profitability and global competitiveness.
Gem & Jewellery Export Promotion Council (GJEPC), which has supported the government's call to moderate gold imports in the national interest, stressed that adequate availability of gold for export manufacturing remains essential as the sector is a major contributor to India's foreign exchange earnings and plays a key role in managing the current account deficit.
Bhansali said the industry was encouraged by the commencement of jewellery exports to Oman under the India-Oman Comprehensive Economic Partnership Agreement (CEPA) and is looking forward to the early conclusion of trade agreements with the US and Canada to further boost exports.
Overall, India's gem and jewellery exports fell 6% to US$ 4.27 billion during April-May 2026, compared with US$ 4.55 billion in the year-ago period.
Among other segments, cut and polished diamond exports declined 9% to US$ 1.87 billion, while coloured gemstone exports fell 10% to US$ 55.93 million. However, polished lab-grown diamond exports rose nearly 2% to US$ 194.78 million, silver jewellery exports surged 172.5% to US$ 365.77 million, and platinum jewellery exports increased 25% to US$ 41.22 million, indicating continued demand in alternative jewellery categories.
