The Gem & Jewellery Export Promotion Council (GJEPC) has estimated that the current health pandemic caused by the global spread of the novel coronavirus COVID-19 would pull India’s gem and jewellery exports down by an additional US$ 2.68 billion to US$ 34.88 billion in FY 2019-20.

In a document discussing the impact on the Gem and Jewellery sector and suggestions to sustain the business through these times, GJEPC notes, “Due to the domestic policy and procedural challenges and sluggish import demand in the world market have recorded a negative growth of (-) 5.53% during April-Nov 2019. While after the outbreak of COVID -19, declining exports growth doubled from (-)5.53% to (-)11.32% during Dec-Feb 2020.”

Industry performance in expected to drop further in March as all customs and other operations are shut due to complete lock down in the country.

Hence, instead of the expected decline in exports to US$37.56 billion during FY 2019-20, which would have been about 5.5% below the US$39.75 billion of exports recorded in FY2018-19, the Council estimates that exports in the current fiscal will now record a 12% fall to US$34.98 billion in value terms.

The sectors that will suffer the most on account of the lockdown within India and other countries and the widespread worldwide restrictions on trade and travel are cut and polished diamonds, coloured gemstones and imitation jewellery.

According to GJEPC, the exports of cut and polished diamonds are down by 19.38% in the eleven months from April 2019 to February 2020, with a massive 40.92% drop in the month of February itself.

Similarly, coloured gemstone exports are down by 17.38% in Apr ’19 – Feb ’20 period and fell by 64.58% in February, while imitation jewellery dropped by 8.95% in Apr-Feb ’20 and by 39.78% in the previous month only.

In terms of end destinations, the Council notes that exports to Hong Kong, Turkey, Singapore, United Kingdom have been impacted the most, recording declines of (-)64.1%, (-)94.57%, (-)34.79% and (-)57.18% respectively in February 2020. Prior to the outbreak of COVID-19 in December 2019 these destinations were either showing growth or relatively smaller declines, it added.

Going forward, GJEPC believes that all other gem and jewellery commodities would face challenging times until business sentiments and consumer confidence return. It says that the organisation has already initiated a number of steps to mitigate the impact of the crisis on businesses as well as the workforce, and is also approaching the government with a set of recommendations that will further assist the industry in dealing with the global challenges.

Click here to read the GJEPC document