{"id":34942,"date":"2026-01-29T17:26:35","date_gmt":"2026-01-29T11:56:35","guid":{"rendered":"https:\/\/gjepc.org\/solitaire\/?p=34942"},"modified":"2026-01-29T17:26:35","modified_gmt":"2026-01-29T11:56:35","slug":"economic-survey-maps-a-complex-role-for-gems-jewellery-in-indias-growth-story","status":"publish","type":"post","link":"https:\/\/gjepc.org\/solitaire\/economic-survey-maps-a-complex-role-for-gems-jewellery-in-indias-growth-story\/","title":{"rendered":"Economic Survey Maps a Complex Role for Gems & Jewellery in India\u2019s Growth Story"},"content":{"rendered":"

India\u2019s Economic Survey presents the gems and jewellery sector as a critical yet complex pillar of the economy, notes Dr Rashmi Arora, Economist, GJEPC<\/strong>. She highlights how the sector supports liquidity and reserves through gold while simultaneously shaping trade volatility, inflation trends and import dependence amid global uncertainty.<\/em><\/p>\n

India\u2019s latest Economic Survey positions the gems and jewellery sector as both a stabilising force and a structural challenge within the broader economy, reflecting its deep linkages with exports, imports, inflation, credit and household savings.<\/p>\n

The Survey notes that India\u2019s macroeconomic fundamentals remain resilient despite global headwinds. According to the Ministry of Statistics and Programme Implementation (MoSPI), GDP grew 6.5% in FY25 on a provisional basis, while First Advance Estimates project growth accelerating to 7.4% in FY26, keeping India the fastest-growing major economy for the fourth consecutive year. This momentum is driven by domestic demand, investment recovery and broad-based sectoral performance.<\/p>\n

Gold\u2019s Expanding Role in Finance and Credit<\/strong><\/p>\n

Within monetary management and financial intermediation, gold emerges as a key financial anchor. Loans against gold jewellery surged 125.3% YoY in November 2025 within the personal loans category, reflecting higher gold prices and increased liquidity needs. Revised MSME lending guidelines now permit the voluntary pledge of gold and silver jewellery as collateral, expanding formal credit access for small businesses.<\/p>\n

However, the Survey flags data gaps among microfinance institutions, which often lack visibility on borrowers\u2019 gold-backed liabilities, complicating credit assessment. Overall, the sector is seen as supporting collateralised lending while strengthening reserve composition.<\/p>\n

Trade Volatility and Export Diversification<\/strong><\/p>\n

The gems and jewellery sector features prominently in the External Sector chapter due to its impact on trade flows. While India\u2019s total merchandise exports remained steady at USD 437.7 billion amid global volatility, export softness was largely attributed to fluctuations in petroleum and gems and jewellery shipments.<\/p>\n

Non-petroleum, non-gems and jewellery exports, which account for nearly 79% of India\u2019s export basket, rose 7.5% YoY to a record USD 374.3 billion. In contrast, gems and jewellery exports were affected by global demand cycles, sharp movements in gold and diamond prices, and shifts in geopolitical and consumer sentiment.<\/p>\n

On the import side, merchandise imports rose 6.3% to USD 721.2 billion in FY25. Petroleum crude and gold together accounted for over one-third of imports. Gold imports jumped 27.4% YoY, driven by a 38.2% rise in international prices and strong domestic consumption, pushing the merchandise trade deficit to USD 283.5 billion, up 17.6%.<\/p>\n

Shift Away from the US Market<\/strong><\/p>\n

The Survey highlights a decisive diversification underway in gems and jewellery exports. Shipments to the US declined 44.3% during April\u2013November FY26, with the US share falling from 33.7% to 18.7%. Despite this, overall exports still grew 0.6%, supported by strong growth to the UAE (34.9%) and Hong Kong (23.4%), taking their combined share to 53.6%.<\/p>\n

Exports also expanded into Bahrain, Saudi Arabia, France, the UK, and in precious stones into Canada, China and Mexico. This shift has been reinforced by trade agreements such as the India\u2013UAE CEPA and progress towards the India\u2013UK FTA.<\/p>\n

Gold, Inflation and the Current Account<\/strong><\/p>\n

The Survey identifies precious metals as major contributors to core inflation. Gold and silver prices rose sharply in 2025 as investors turned to safe-haven assets amid global uncertainty. Core inflation stood at about 4.6%, but when gold and silver were excluded, it dropped to 2.3\u20132.4%, indicating a wedge of roughly 235 basis points created by precious metals.<\/p>\n

Sustained gold demand has also intensified current account pressures. The Survey notes that gold remains one of the most persistent drivers of external imbalance due to high import dependence, even at elevated global prices.<\/p>\n

How the Economic Survey Reads the G&J Sector<\/strong><\/p>\n\n\n\n\n\n\n\n\n\n\n\n
G&J as an Enabler<\/strong><\/td>\nG&J as a Constraint<\/strong><\/td>\n<\/tr>\n<\/thead>\n
Financial stabiliser<\/strong> through gold-backed lending<\/td>\nExport volatility<\/strong> tied to global demand cycles and price swings<\/td>\n<\/tr>\n
Loans against gold jewellery up 125.3% YoY<\/strong><\/td>\nG&J shipments softened overall export growth<\/td>\n<\/tr>\n
MSME credit access widened via jewellery collateral<\/td>\nSensitivity to geopolitical and consumer sentiment<\/td>\n<\/tr>\n
FTA-led diversification<\/strong> beyond the US<\/td>\nInflation impact<\/strong> from high gold and silver prices<\/td>\n<\/tr>\n
Exports to UAE up 34.9%<\/strong>, Hong Kong up 23.4%<\/strong><\/td>\nCore inflation lifted by ~235 bps<\/strong><\/td>\n<\/tr>\n
Strong forex buffer<\/strong> via gold reserves<\/td>\nCAD pressure<\/strong> from elevated gold imports<\/td>\n<\/tr>\n
Gold reserves rose from USD 78.2 bn to USD 117.5 bn<\/strong><\/td>\nGold imports up 27.4% YoY<\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Credit Constraints and Policy Gaps<\/strong><\/p>\n

Despite its scale, bank credit to the gems and jewellery sector slowed sharply, growing just 1.01% in FY25, compared with a 4.53% CAGR during FY21\u2013FY24. While MSME measures allow jewellery-backed loans, overall lending momentum remains subdued.<\/p>\n

Missing Link – PLI Scheme<\/strong><\/p>\n

The Economic Survey also flags a clear policy asymmetry. The Production Linked Incentive (PLI) scheme<\/strong>, launched in April 2020 and expanded to cover 14 sectors<\/strong>, delivered strong trade outcomes during FY21\u2013FY25, with exports from PLI-supported sectors growing at an average annual rate of 10.6%<\/strong> and imports at 12.6%<\/strong>, reflecting rising domestic production and deeper value-chain integration. Sectors such as electronics, IT hardware, ACC batteries, solar PV, speciality steel, automobiles, textiles and pharmaceuticals benefited from targeted manufacturing incentives.<\/p>\n

However, the gems and jewellery sector is not covered under the PLI framework and therefore does not benefit from incentive-linked production expansion, technology upgradation or scale-building interventions. The Survey implicitly contrasts this exclusion with the sector\u2019s macro relevance, underscoring a gap between its economic impact and policy support.<\/p>\n

A Sector of Strategic Importance<\/strong><\/p>\n

Taken together, the Economic Survey frames gems and jewellery as a macro-critical sector. It strengthens liquidity, reserves and export diversification, yet amplifies pressures on inflation, trade balance and credit flow. The message is clear: sustaining the sector\u2019s role in India\u2019s growth story will require calibrated policy support, deeper global integration and continuous competitiveness upgrades.<\/p>\n","protected":false},"excerpt":{"rendered":"

India\u2019s Economic Survey presents the gems and jewellery sector as a critical yet complex pillar of the economy, notes Dr Rashmi Arora, Economist, GJEPC. She highlights how the sector supports liquidity and reserves through gold while simultaneously shaping trade volatility, inflation trends and import dependence amid global uncertainty. India\u2019s latest Economic Survey positions the gems…<\/p>\n","protected":false},"author":16,"featured_media":34943,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[100,90],"tags":[],"thb-sponsors":[],"class_list":["post-34942","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-in-focus","category-policy"],"acf":[],"yoast_head":"\nEconomic Survey Maps a Complex Role for Gems & Jewellery in India\u2019s Growth Story - Solitaire magazine is a International jewellery magazine - India\u2019s leading B2B gem and jewellery magazine<\/title>\n<meta name=\"robots\" content=\"index, follow\" \/>\n<meta name=\"googlebot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta name=\"bingbot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/gjepc.org\/solitaire\/economic-survey-maps-a-complex-role-for-gems-jewellery-in-indias-growth-story\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Economic Survey Maps a Complex Role for Gems & Jewellery in India\u2019s Growth Story - Solitaire magazine is a International jewellery magazine - India\u2019s leading B2B gem and jewellery magazine\" \/>\n<meta property=\"og:description\" content=\"India\u2019s Economic Survey presents the gems and jewellery sector as a critical yet complex pillar of the economy, notes Dr Rashmi Arora, Economist, GJEPC. She highlights how the sector supports liquidity and reserves through gold while simultaneously shaping trade volatility, inflation trends and import dependence amid global uncertainty. India\u2019s latest Economic Survey positions the gems…\" \/>\n<meta property=\"og:url\" content=\"https:\/\/gjepc.org\/solitaire\/economic-survey-maps-a-complex-role-for-gems-jewellery-in-indias-growth-story\/\" \/>\n<meta property=\"og:site_name\" content=\"Solitaire magazine is a International jewellery magazine - India\u2019s leading B2B gem and jewellery magazine\" \/>\n<meta property=\"article:published_time\" content=\"2026-01-29T11:56:35+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/gjepc.org\/solitaire\/wp-content\/uploads\/2026\/01\/Economic.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1000\" \/>\n\t<meta property=\"og:image:height\" content=\"600\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebSite\",\"@id\":\"https:\/\/gjepc.org\/solitaire\/#website\",\"url\":\"https:\/\/gjepc.org\/solitaire\/\",\"name\":\"Solitaire magazine is a International jewellery magazine - India\\u2019s leading B2B gem and jewellery magazine\",\"description\":\"\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":\"https:\/\/gjepc.org\/solitaire\/?s={search_term_string}\",\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"ImageObject\",\"@id\":\"https:\/\/gjepc.org\/solitaire\/economic-survey-maps-a-complex-role-for-gems-jewellery-in-indias-growth-story\/#primaryimage\",\"inLanguage\":\"en-US\",\"url\":\"https:\/\/gjepc.org\/solitaire\/wp-content\/uploads\/2026\/01\/Economic.jpg\",\"width\":1000,\"height\":600},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/gjepc.org\/solitaire\/economic-survey-maps-a-complex-role-for-gems-jewellery-in-indias-growth-story\/#webpage\",\"url\":\"https:\/\/gjepc.org\/solitaire\/economic-survey-maps-a-complex-role-for-gems-jewellery-in-indias-growth-story\/\",\"name\":\"Economic Survey Maps a Complex Role for Gems & Jewellery in India\\u2019s Growth Story - Solitaire magazine is a International jewellery magazine - India\\u2019s leading B2B gem and jewellery magazine\",\"isPartOf\":{\"@id\":\"https:\/\/gjepc.org\/solitaire\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/gjepc.org\/solitaire\/economic-survey-maps-a-complex-role-for-gems-jewellery-in-indias-growth-story\/#primaryimage\"},\"datePublished\":\"2026-01-29T11:56:35+00:00\",\"dateModified\":\"2026-01-29T11:56:35+00:00\",\"author\":{\"@id\":\"https:\/\/gjepc.org\/solitaire\/#\/schema\/person\/68084079f2ef031a079240181c5a595d\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/gjepc.org\/solitaire\/economic-survey-maps-a-complex-role-for-gems-jewellery-in-indias-growth-story\/\"]}]},{\"@type\":[\"Person\"],\"@id\":\"https:\/\/gjepc.org\/solitaire\/#\/schema\/person\/68084079f2ef031a079240181c5a595d\",\"name\":\"David Brough\",\"image\":{\"@type\":\"ImageObject\",\"@id\":\"https:\/\/gjepc.org\/solitaire\/#personlogo\",\"inLanguage\":\"en-US\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/efca004f2eae927c1badeed8325214b88146aa38ca055950db33decd23944a5e?s=96&d=mm&r=g\",\"caption\":\"David Brough\"}}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","_links":{"self":[{"href":"https:\/\/gjepc.org\/solitaire\/wp-json\/wp\/v2\/posts\/34942","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/gjepc.org\/solitaire\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/gjepc.org\/solitaire\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/gjepc.org\/solitaire\/wp-json\/wp\/v2\/users\/16"}],"replies":[{"embeddable":true,"href":"https:\/\/gjepc.org\/solitaire\/wp-json\/wp\/v2\/comments?post=34942"}],"version-history":[{"count":1,"href":"https:\/\/gjepc.org\/solitaire\/wp-json\/wp\/v2\/posts\/34942\/revisions"}],"predecessor-version":[{"id":34944,"href":"https:\/\/gjepc.org\/solitaire\/wp-json\/wp\/v2\/posts\/34942\/revisions\/34944"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/gjepc.org\/solitaire\/wp-json\/wp\/v2\/media\/34943"}],"wp:attachment":[{"href":"https:\/\/gjepc.org\/solitaire\/wp-json\/wp\/v2\/media?parent=34942"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/gjepc.org\/solitaire\/wp-json\/wp\/v2\/categories?post=34942"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/gjepc.org\/solitaire\/wp-json\/wp\/v2\/tags?post=34942"},{"taxonomy":"thb-sponsors","embeddable":true,"href":"https:\/\/gjepc.org\/solitaire\/wp-json\/wp\/v2\/thb-sponsors?post=34942"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}