Three years ago, India and the UAE inked a landmark trade deal: the Comprehensive Economic Partnership Agreement (CEPA). GJEPC explores how CEPA has transformed bilateral trade, boosting exports, reshaping market dynamics, and unlocking significant opportunities for Indian jewellers.
The Comprehensive Economic Partnership Agreement (CEPA) between India and the UAE, formalised on 18th February 2022, has profoundly strengthened economic ties between the two nations. As we commemorate its third anniversary, it is evident that CEPA has significantly enhanced trade opportunities, particularly for India’s gem and jewellery industry.
Trade Growth Post-CEPA
Since CEPA’s implementation, trade between India and the UAE has witnessed remarkable growth. The bilateral gem and jewellery trade surged from US$ 20.88 billion in FY2022 to US$ 28.15 billion in FY2024, reflecting a robust 35% increase. India’s gem and jewellery exports to the UAE also soared by over 60%, from US$ 4.95 billion in FY2022 to US$ 8.04 billion in FY2024.
Notably, UAE’s share in India’s total exports rose from 13% in FY2022 to 25% in FY2024, overtaking Hong Kong as India’s second-largest export market. This underscores the transformative impact of CEPA on India’s trade dynamics.
Kirit Bhansali, Chairman, GJEPC, said, “The India-UAE CEPA has propelled our gem and jewellery exports to new heights, growing by over 60% from US$ 4.95 billion in FY2022 to US$ 8.04 billion in FY2024. The UAE now accounts for nearly a quarter of India’s total gem and jewellery exports, surpassing Hong Kong. The duty-free advantage has unlocked immense opportunities, particularly in plain gold jewellery, which saw a 127% surge. As we celebrate three years of CEPA, we remain committed to strengthening this vital partnership and exploring new avenues for growth.”
Country-wise India’s Gem & Jewellery Exports
| Country | 2021-2022 | % Share | 2022-2023 | % Share | 2023-2024 | % Share |
| US$ Mn | US$ Mn | US$ Mn | ||||
| USA | 14,667.48 | 37.35 | 12,586.25 | 33.02 | 9,948.50 | 30.28 |
| UAE | 4,953.11 | 12.61 | 5,772.47 | 15.15 | 8,043.08 | 24.48 |
| HONG KONG | 9,379.20 | 23.88 | 8,736.38 | 22.92 | 6,727.40 | 20.48 |
| BELGIUM | 2,740.37 | 6.98 | 2,696.17 | 7.07 | 2,100.08 | 6.39 |
| ISRAEL | 1,474.12 | 3.75 | 1,279.76 | 3.36 | 792.17 | 2.41 |
| Others | 6054.17 | 15.41 | 7041.28 | 18.48 | 5241.68 | 15.96 |
| Total | 39,268.45 | 100.00 | 38,112.31 | 100.00 | 32,852.91 | 100.00 |
Source: GJEPC Research Division based on DGCIS
Key Commodity Trends
One of the most significant benefits of CEPA has been the duty-free access for all gem and jewellery products, including gold, silver, and platinum jewellery, along with polished diamonds and gemstones.
This development has motivated Indian exporters to increase their supply of various gem and jewellery items to the UAE, capitalising on the enhanced market access provided by the agreement.
This policy shift has led to substantial growth in key export categories:
- Plain Gold Jewellery: Exports surged by 127.62%, reaching US$ 4,240 million in FY2024.
- Studded Gold Jewellery: Increased by over 50%, from US$ 917 million in FY2022 to US$ 1,382 million in FY2024.
- Worked Lab-Grown Diamonds: Witnessed a 58.16% growth, reaching US$ 172 million in FY2024.
- Platinum Jewellery: Recorded a staggering 820.87% increase, reaching US$ 23 million.
- Coloured Gemstones: Grew by 17.19% to US$ 9.34 million.
India’s Gem & Jewellery exports to UAE (FY2022 and FY2023)
| Commodity Category | 2021-22 | 2023-2024 | % Growth |
| US$ Mn | US$ Mn | ||
| Cut & Polished Diamonds | 1647.46 | 1,587.18 | -3.66 |
| Worked Lab Grown Diamonds | 109.01 | 172.41 | 58.16 |
| Plain Gold Jewellery | 1862.77 | 4,240.09 | 127.62 |
| Studded Gold Jewellery | 917.48 | 1381.98 | 50.63 |
| Total Gold Jewellery | 2780.25 | 5,622.07 | 102.21 |
| Silver Jewellery | 11.55 | 8.65 | -25.11 |
| Coloured Gemstones, worked | 7.97 | 9.34 | 17.19 |
| Platinum Jewellery | 2.54 | 23.39 | 820.87 |
| Imitation Jewellery | 14.54 | 6.07 | -58.25 |
| Others | 379.79 | 613.97 | 61.66 |
| Total | 4953.11 | 8043.08 | 62.38 |
Source: GJEPC Research Division based on DGCIS
While polished diamond exports saw a slight decline in FY2024 due to global demand fluctuations, lab-grown diamond exports recorded steady growth.
Rising Gold Imports from the UAE
CEPA has also facilitated a sharp rise in India’s gold bar imports from the UAE. Under the Tariff Rate Quota (TRQ) mechanism, India levies a preferential duty of just 1% on UAE-origin gold. As a result, India’s imports of unwrought gold from the UAE surged by 126.76% in FY2024, reaching US$7.64 billion. This demonstrates CEPA’s role in boosting gold trade efficiency between both nations.
Import of Gold Bar (HS Code-7108) from UAE in value terms (US$ Mn)
| Gold Bar Imports | Imports from World | % Growth | Imports from UAE | % Growth | ||||
| Qty in Tons | US$ MN | US$ MN | Qty in Tons | US$ MN | US$ MN | |||
| 2020-2021 | 651.24 | 34603.93 | 70.58 | 4194.89 | ||||
| 2021-2022 | 879.01 | 46165.49 | 34.97 | 99.76 | 5839.46 | 41.34 | ||
| 2022-2023 | 678.3 | 35016.09 | -22.83 | 52.81 | 3089.09 | -47.06 | ||
| 2023-2024 | 795.25 | 45542.07 | 17.24 | 119.75 | 7647.17 | 126.76 | ||
| April 23 – Nov 23 | 567.66 | 32,925.16 | 74.68 | 4,679.18 | ||||
| April 24 – Nov 24 | 491.27 | 37,385.41 | -13.46 | 122.62 | 9,979.93 | 64.19 | ||
Source: DGCI&S
Strategic Implications for India’s G&J Sector
The CEPA agreement has created a conducive environment for Indian jewellers to expand their footprint in the UAE, a key global jewellery hub. The removal of import duties has enhanced India’s competitive edge, boosting long-term trade partnerships and ensuring continued growth in exports.
With UAE’s rising importance as a key market, Indian exporters must leverage CEPA’s benefits by further strengthening business collaborations and diversifying product offerings. The agreement’s success underscores its potential as a model for future trade deals, fostering sustained economic growth for both nations.
GJEPC Recommendations
The India-UAE CEPA has undeniably transformed trade dynamics, particularly for the gem and jewellery sector. However, to further enhance bilateral trade, GJEPC urges the following strategic actions:
- Manufacturing-Retail Integration: India should position itself as a manufacturing hub for UAE-based jewellers, while Indian retailers expand into Dubai, replicating the successful Hong Kong-Mainland China model.
- Investment in Manufacturing: UAE investors should be encouraged to participate in India’s jewellery parks, mega CFCs, and infrastructure projects, fostering greater value addition.
- IJEX Dubai as a Designated Zone: To streamline trade, recognising IJEX Dubai as a Designated Zone will allow smoother imports under CEPA for businesses not registered in the UAE.
- Ease of Doing Business: Addressing consignment-based exports, exhibition shipments, and import clarity will further strengthen India’s competitiveness.
With these measures, India-UAE bilateral trade can scale to US$ 30 billion within five years, solidifying CEPA’s role as a game-changer for the industry.