Snapshot

Glittering India

India is one of the largest exporters of Gems and Jewellery. The industry plays a vital role in the Indian economy for its role as a major contributor to the total foreign exchange reserves of the country.

The overall net exports of Gems and Jewellery registered an annual growth of 9.1% to reach $ 35.6 bn during 2016-17. Exports of cut and polished diamonds, gold jewellery and silver jewellery registered a growth of 10.2%, 1.9% and 35.9%, respectively during 2016-17. Exports of gold coins and medallions from India stood at $ 1.9 bn, while exports of silver jewellery stood at $ 3.3 bn during April 2017-February 2018.

India is also a major importer of gems and jewellery.  The imports of gems and jewellery increased at a CAGR of 7.8% from $ 11.63 bn in 2004-05 to $ 28.8 bn in 2016-17. The imports during April 2017-February 2018 stood at $ 28.3 bn.

US, Hong Kong and UAE are the major exporters, who accounted for 75% of the total gems and jewellery exports from India during 2016-17. Other big importers of Indian jewellery include Russia, Singapore, Latin America and China. 

The Indian Government has permitted 100% Foreign Direct Investment (FDI) in the sector under the automatic route.

For further details, please refer FDI Policy

  • 4.5 mn

    Employment generation

  • 13

    Share in India's commodity exports

  • 16%

    Industry CAGR (2014-19)

  • 7%

    Contribution to GDP 

A

Largest diamond processing centre in the world

B

2nd largest Foreign Exchange Earner (FEE) in the Indian economy

C

Biggest buyer of gold in the world

Industry Scenario

The market size of Gems and Jewellery in India contributes to about 7% of the country’s GDP. 

Gems and Jewellery industry contributes to about 16% to India’s total merchandise exports and has grown at a CAGR of over 14.8% over the last 50 years. The Gems and Jewellery industry in India is one of the largest in the world, contributing 29% to the global jewellery consumption.

The overall market size is expected to reach $ 110 bn by 2022 from approximately $ 60 bn in 2017. The industry that currently employs over 4.5 mn people, is expected to provide employment opportunities to over 8.2 mn people by 2022.

Gems and Jewellery comprises of the following sub-sectors:

  • Diamonds
  • Gemstones
  • Pearl
  • Gold, Silver and Platinum Jewellery

 
India being the largest manufacturer of cut and polished diamonds globally, its global diamond market share is 60% and 90% in value terms and volume terms, respectively. The country where gold jewellery forms around 80% of the total jewellery market, stood as the biggest buyer of gold globally in 2016-17.

Growth Drivers

  • Traditional Domestic Demand

    Rise in gold demand during weddings and festivals like Diwali

  • Rising Income Levels

    Rise in income levels is directly proportional to rise in gold demand

  • Growing Middle-Class Population

    Population to reach 500 mn by 2025

  • Increasing Expenditure

    India to become 3rd largest consumer economy by 2025

  • Growing Organized Retail Format

    Indian retail market to reach $ 1 tn by 2020

  • Open

    BIS Hallmarking Scheme

    The Bureau of Indian Standards (BIS) has revised the standar…

  • Open

    Gold Monetisation Scheme 2015

    It allows the depositors of gold to earn interest in their m…

  • Open

    Goods and Services Tax (GST) benefits to…

    Benefits given to the sector under GST act.

  • Open

    Sovereign Gold Bond Scheme

    Enables the RBI to issue gold bonds denominated in grams.

Major Investors

Data on Map

FAQ

Frequently
Asked Questions

  • Banks import gold / silver on consignment basis wherein the ownership of the metal is with the supplier of the bullion which maybe an overseas entity. Is the overseas entity required to have GST registration because currently they do not file returns and are governed by multi-nation treaties?

    This amounts to an import in accordance with the definition of the word “import” in the IGST Act, 2017 which provides that “bringing into India of any goods from any place outside India” is an import of the goods. What is material in this definition is the mere act of bringing into India; the ownership is not material for determining whether an import has taken place. Banks, being registered entities, would be liable to pay IGST on such imports but not the overseas entities since they are not effecting the import.

  • What are the GST benefits under gems and jewellery sector?

    Few Goods and Services Tax (GST) benefits under the gems and jewellery sector is as follows:
    a) Rate of duty on cut and polished colored gemstones changed from 2.5% to 5%.
    b) Rate of duty on diamonds including lab grown diamonds-semi processed, halfcut or broken, non-industrial diamonds including lab-grown diamonds (other than rough diamonds), including cut and polished diamonds changed from 2.5% to 5%.
    c) Rate of duty on Imitation Jewellery changed from 15% to 20%.

  • What is a Sovereign Gold Bond Scheme?

    The Government of India launched the Sovereign Gold Bond Scheme. This scheme enables the Reserve Bank of India (RBI) to issue gold bonds denominated in grams of gold individuals in consultation with Ministry of Finance. This scheme provides an alternative to owning physical gold. It is aimed at keeping a check on imports of gold.

  • When we are selling Gold, Diamond or Silver Jewellery to the end consumer (Customer) like a Gold Chain weighing 10 gm at a total value of $. 454.16 (gold value is $. 423.89 and making charges on that gold chain is $. 30.28), can we charge GST @3% on the total value or @3% on the gold value and @5% on making charges?

    GST is payable at the rate of 3% of the total transaction value of jewellery, whether the making charge is shown separately or not.

  • Where can I find more information on the BIS Hallmarking Scheme?

    The government of India' has identified BIS a sole agency in India to operate this scheme. BIS hallmarking Scheme is voluntary in nature and is operating under BIS Act, Rules and Regulations. It operates on the basis of trust and thus it is desirable that aspect of quality control isin-built in the system responsible for managing quality.

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