Mumbai: Following the US announcement of a 25 per cent tariff on India, Industry leaders in the Indian Gems and Jewellery sector expressed deep concern, warning of short-term disruptions, potential job losses, and rising prices for American consumers.
However, business leaders also pointed to India’s expanding trade ties, including recent Free Trade Agreements (FTAs) with the UK, Australia, and the UAE, as a buffer against the fallout, suggesting the long-term impact may hurt the US more than India.
US President Donald Trump today, in a social media post on his Truth Social Account, announced 25 per cent tariffs on India starting August 1.
Trump also said India will face additional penalties for purchasing oil from Russia.
In FY 2023-24, India’s gems and jewellery exports stood at 22 billion US dollars, projected to reach US$100 billion by 2027.
India is the top global exporter of diamonds and the largest consumer of gold.
Speaking to ANI, Rajesh Rokde, Chairman of the All India Gem & Jewellery Domestic Council, stressed that the tariff is not only painful for India but could also hurt the United States significantly.
“This is very unfortunate. The tariff that will be implemented from August 1 is not only painful for India but could also significantly hurt the US. I believe that imposing tariffs negatively affects businesses. India exports jewellery to the entire world. If we look at the numbers, trade worth nearly 9 billion dollars takes place with the US. This will be 100 percent affected. The handmade jewellery that is appreciated there will also be impacted. It will become more expensive in the US. This will be a very unfortunate situation for the jewellery industry,” Rokde said.
He, however, expressed optimism that India has already found alternative routes.
“Given the current scenario, India has already found alternative routes. We have recently finalised agreements with the Middle East and the European Union, so India has many options now. Hence, the greater impact might fall on the US. The US’s tariff policy seems quite complicated. The global tariff war they have initiated is not a good sign. This will also affect the US economy,” the Chairman of the All India Gem & Jewellery Domestic Council said.
He also hoped that these tariffs would be reduced soon.
“Just as our Prime Minister has worked and set the vision of a Developed India by 2047, I believe these tariffs may be reduced very soon. India has always skillfully balanced both the US and Russia. Our economy is very strong because no other country in the world has as many consumers as we do, and that is our strength,” Rokde said.
“Due to this tariff, the jewellery industry in India may face some unemployment issues for a few days. But I also believe that this will be resolved soon,” he added.
Avinash Gupta, Vice Chairman of the All India Gem & Jewellery Domestic Council, stressed that the best part is that the Indian government has already done Free Trade Agreements (FTA) with countries including the UK and Australia.
“Definitely, it will affect the Gem and Jewellery Industry, but the best part is that the Indian Government has done FTAs with the UK, Australia and other countries also, so we have much more options available than the US only. We will have many more options for exporting to other countries. It will hurt us as the US is a big market for the Gem and Jewelery industry. It will affect us, but it will not hamper us,” Gupta told ANI.
He mentioned that after India’s FTA with the United Kingdom, the Gems and Jewellery Industry will start focusing on the UK rather than the US.
“The UK is a big market for the Indian Gem and Jewellery industry, and with the FTA being done at zero per cent duty, it is going to be an advantage for us. The Gem and Jewellery Industry will start focusing on the UK rather than the US. We have a good FTA with the UAE also. We feel it is not going to be a big damper because it is going to hurt more to US consumers than Indians,” Avinash Gupta said.
“We are doing approximately 10 billion dollars in business with the US, and if I look at the UK, we were doing only 1 billion dollars, and we are expecting 4 billion dollars in business with the UK. Diamond will be affected a lot because for it, the US is a huge market, but it will be taken care of in the long run,” he said.
