INDUSTRY & SERVICES GEMS AND JEWELLERY Gems and Jewellery is an important emerging sector in the Indian Economy.

Ranked among the fastest growing sectors, it is also a leading sector for foreign exchange generation. The gems and jewellery industry is very much fascinating being traditionally glamorous and artistically modern. This business employees and engages millions; cover wide activities such as raw material procurement from far flung Africa, Australia, Canada and Russia, and transforming these into products in demand with the skills available in China, India, Italy and Turkey for the sophisticated markets in the USA, Europe, Far East, Middle East and Asia. India's Position in Gems and Jewellery Sector

Gems and Jewellery is one of India 's leading foreign exchange earning sectors. It accounted for 16.7 per cent of India 's total Merchandise Exports. USAs import of Gem & Jewellery from India increased by 50.5% in 2010 as compared to 2009. India Gems & Jewellery exports are expected to grow at a whopping 15 to 20 per cent in FY 2011-2012. At present India exports 95% of the worlds diamonds.

Advantage India

Gems and Jewellery hub Rich tradition / heritage of craftsmanship with high level of skills Low production costs Effective worldwide distribution network for promotion and marketing. Diamond polishing capital of the world. Manufacturing excellence

Key Industry Components Diamonds: Diamonds have always enjoyed a special place among precious gemstones. In the past, diamond jewellery was limited to a very small elite segment of the global population. However, over the past 50 years, diamonds have seen increasing democratisation. Diamond jewellery has, therefore, emerged as a segment showing significant growth in some of the emerging markets. Gold: Gold has always been the jewellers' favourite metal given its intrinsic lustre and ease of fabrication Gold jewellery enjoys the leading position in most markets across the world, and in many ways forms the backbone of the precious jewellery industry. Given the fact that gold is also one of the traded metals, gold jewellery consumption is also impacted by gold price movements.

Coloured gemstones: This segment includes all other forms of jewellery; precious gemstones (emeralds, sapphires, rubies and tanzanite) and semi-precious gemstones; silver, pearls, etc. The industry is highly fragmented making it difficult to track supply, demand and global trade. Exports During the Fiscal Year 2010-11, the total exports for gems and jewellery stood at US$ 43139.24 million as compared to US$ 29368.72 million during the fiscal year 2009-10. During the same period, the sector registered a growth of 46.89 per cent over the previous year. Composition of Exports

Cut and polished diamonds: The export of cut and polished diamonds grew manifold in 2010-11 as compared to 2009-10. In 2010-11, the export of cut and polished diamonds was US$ 28251.92 million as compared US$ 18237.56 million, recording a growth of 54.91 per cent. Coloured Gemstones: Export of coloured gemstones was registered at US$ 314.54 million in 2010-11 as compared to US$ 286.78 million in 2009-10, showing a growth of 9.68 per cent. Gold Jewellery: Export of Gold jewellery also grew in 2010-11, registering US$ 12885.59 million as compared to US$ 9669.10 million in 2009-10. A growth of 33.27 per cent was recorded.

Net Exports of Gems and Jewellery items during April-October 2011 The summary of export of gems and jewellery items during April 2010-March 2011 as compared to same period last year Items April-October April-October 2010 2011 (Same ports as current year) US$ in Million Cut & Pol Diamonds Gold Jewellery-D.T.A SEZ/EPZ (included Gold Jewellery & Gold Medallions and coins) Total Coloured Gemstones Silver Jewellery Others * Net Exports 15195.08 1357.28 7968.97 US$ in Million 14807.71 1209.24 5535.29 % Growth/decline over previous Year US$ 2.62 12.24 43.97

9326.25 187.17 386.92 17.52 25112.94

6744.53 158.45 284.18 9.08 22003.95

38.28 18.13 36.15 92.95 14.13

Exports Diamonds Others Total Exports

of

Rough

995.65 51.45 26160.04

580.44 31.96 22616.35

71.53 --15.67

Source: The Gem & Jewellery Export Promotion Council (GJEPC) (As per RBI average exchange rate)

* Data of Cut & Pol Diamonds include export of CPD (Bonded W.H) also. Figures for April - October '2011 are provisional and subject to revision. Data for October 2011 does not include figures from Vizkhapatnam SEZ, Cochin Air Cargo & Mumbai FPO Above figures does not include data for Costume/ Fashion Jewellery, and Sales to foreign tourists.

INDUSTRY & SERVICES Foreign Direct Investment Policy

At present, the Indian government allows 100 per cent foreign direct investment (FDI) in gems and jewellery through the automatic route. For exploration and mining of diamonds and precious stones FDI is allowed up to 74 per cent under the automatic route. For exploration and mining of gold and silver and minerals other than diamonds and precious stones, metallurgy and processing, FDI is allowed up to 100 per cent under the automatic route.

Foreign Trade Policy (2009-2014) Initiatives Import of gold of 8k and above is allowed under replenishment scheme subject to import being accompanied by an Assay Certificate specifying purity, weight and alloy content. Duty Free Import Entitlement [based on Free On Board (FOB) value of exports during previous financial year] of consumables and tools, for:

Jewellery made out of:

 Precious metals (other than gold & platinum) - 2 per cent Gold and platinum - 1 per cent Rhodium finished silver - 3 per cent
Cut and polished diamonds - 1 per cent Duty free import entitlement of commercial samples shall be US$ 6187.9. Duty free re-import entitlement for rejected jewellery shall be 2 per cent of FOB value of exports. Import of diamonds on consignment basis for certification/ grading & re- export by the authorized offices/agencies of Gemological Institute of America (GIA) in India or other approved agencies will be permitted. Personal carriage of gems & jewellery products in case of holding/participating in overseas exhibitions increased to US$ 5 million and to US$ 1 million in case of export promotion tours. Extension in number of days for re-import of unsold items in case of participation in an exhibition in USA increased to 90 days. In an endeavour to make India an international trading hub for diamond, it is planned to establish "Diamond Bourse (s)". Investment Opportunities

Gemstone Processing (Cutting and Polishing) Jewellery Manufacturing and Retailing Jewellery Certification Branded Jewellery

Top 10 Buyers of Indian Gems and Jewellery

United Arab Emirates (U.A.E.) Hong Kong United States of America Belgium Israel Singapore Thailand United Kingdom Japan Australia

Major Players in Indian Gems and Jewellery

Gitanjali Group Shrenuj & Company Suraj Diamonds and Jewellery Limited Rajesh Exports Asian Star Titan Industries (Tanishq into Retail), Bangalore Suashish Diamond

Rosy Blue B. Vijaykumar Laxmi Diamond K Girdharilal C. Mehendra Exports J.B Brothers Tara - Ultimo Vaibhav Gems, Jaipur Sheetal Manufacturing

Gem and Jewellery Export Promotion Council (GJEPC) The Gem and Jewellery Export Promotion Council is a representative body of trade. The following initiatives have been taken by the council in order to enhance competitiveness such as:

Preparation of a medium term exports strategy for various sectors including gems and jewellery by the Ministry of Commerce. Exploring the possibility of direct procurement of rough diamonds from mining countries. Promotion of Indian diamonds and jewellery abroad through advertisements, publicity and participation in international fairs, buyer-seller meets and direct approach to market retailers. Market study through experts in the field to identify new markets. Promotion of export of 'hallmark' jewellery from India to assure foreign customers of quality and purity of jewellery made in India .

Useful Weblinks

Gem and Jewellery Export Promotion Council