India gem and jewellery exports fall 6% in FY27 start

Exports open FY27 with a softer start

India’s gem and jewellery exports totalled $1.27 billion in April-May 2026, down from $1.55 billion in the same period a year ago. In dollar terms, exports fell 6.03% year-on-year, even as they rose 3.99% in rupee terms, reflecting currency movement and pricing dynamics. The Gems and Jewellery Export Promotion Council (GJEPC) linked the overall decline largely to a steep fall in plain gold jewellery shipments. At the same time, parts of the category mix performed better, with studded gold jewellery reporting growth.

Plain gold jewellery leads the decline

Data cited by GJEPC showed plain gold jewellery exports fell 40.11% year-on-year to $1.636 billion in April-May 2026, compared with $1.06 billion in April-May 2025. Chairman Kirit Bhansali described plain gold jewellery as the main concern within the export basket for the period. The sharper drop in this segment outweighed gains seen in other product lines and pulled down the overall April-May export print.

Studded gold jewellery offers some support

Bhansali said studded gold jewellery exports grew 6.71% year-on-year to $1.964 billion during April-May 2026, versus $1.903 billion a year earlier. The improvement in studded exports suggests demand and order flow did not weaken uniformly across the gold jewellery complex. Even so, the scale of the contraction in plain gold jewellery was large enough to keep the headline export figure in negative territory.

Gold supply tightening becomes a key operational issue

GJEPC pointed to tightening in gold imports as a key reason behind the decline in plain gold jewellery exports, saying it affected gold availability for export manufacturing. Bhansali said the council has taken up the issue with the government and expressed hope for a resolution. He also flagged challenges in gold sourcing through banking channels, citing regulatory bottlenecks that have affected gold availability from banks for exporters.

Lower gold consumption for export production

GJEPC estimated that gold consumption for export production fell to 11 tonnes in April-May 2026 from around 14 tonnes in the corresponding period last year. This implies a reduction of nearly 21.4%, consistent with the reported weakness in plain gold jewellery shipments. For export-oriented manufacturers, lower metal availability can translate into fewer finished shipments, longer lead times, and tighter working-capital cycles, especially when input prices are rising.

Higher gold prices add pressure on costs and liquidity

Bhansali said the sector’s challenges were compounded by a sharp rise in gold prices. The average gold price during April-May 2026 rose 45.69% year-on-year to $1,723.88 per troy ounce, from $1,242.48 per troy ounce in April-May 2025. GJEPC also highlighted that the increase in gold import duty from 6% to 15% raised the landed cost of gold. At the same time, it said Duty Drawback rates have not been revised accordingly, affecting competitiveness and margins.

May performance: modest fall in total exports, sharper drop in gold jewellery

For May, gems and jewellery exports were reported at $1.05 billion, down about 2% from $1.10 billion in the same month last year. The text linked the decline to a scarcity of gold and higher uncertainty connected to the United States-Iran conflict. Within this, gold jewellery exports fell 15% to $1.758 billion from $1.890 billion. The May snapshot broadly aligned with the April-May trend, where gold availability and higher prices were key constraints.

A wider context: tariffs, destination risks, and mixed demand

Separately, GJEPC data for April 2025 to January 2026 showed gross exports at $13.19 billion, a 0.64% decline in dollar terms from $13.33 billion a year earlier, while rising 3.57% in rupee terms. GJEPC said the outcome was influenced by a sharp contraction in shipments to the United States, with exports to the country declining by over 45% due to elevated tariffs and pricing disadvantages. The broader set of excerpts also referenced a period where Indian exports to the US declined 37.5% over four months, following the imposition of 50% tariffs on most Indian goods, with shipments falling from $1.8 billion in May 2025 to $1.5 billion in September 2025.

Key figures at a glance

Market impact: what exporters are flagging

GJEPC’s comments centre on two linked pressures. First, the council is arguing that tighter gold imports and regulatory frictions have reduced the availability of gold required for export manufacturing, which is visible in lower estimated consumption and weaker plain gold jewellery exports. Second, sharply higher gold prices and higher import duty are pushing up input costs, while Duty Drawback rates have not been revised in the excerpts, raising concerns about competitiveness and margins. Bhansali said the industry is facing a “serious liquidity and raw material availability crunch” and that the council has been engaging with the government on an urgent basis.

Why the April-May mix matters for the sector

The April-May numbers indicate that performance is being driven by product-level divergence rather than a uniform slowdown. Studded gold jewellery grew in the period, but plain gold jewellery contracted steeply, pulling down the overall export total. The estimates of lower gold consumption, paired with a material rise in dollar gold prices, point to operational constraints meeting a challenging cost environment. The duty increase highlighted by GJEPC adds another layer to landed cost and working-capital requirements.

Conclusion

India’s gem and jewellery exports began FY27 with a 6.03% decline in dollar terms to $1.27 billion in April-May 2026, led by a sharp fall in plain gold jewellery shipments. GJEPC has asked the government to address gold supply constraints and banking-channel regulatory bottlenecks, while also highlighting cost pressures from higher gold prices and higher import duty. Further clarity is expected from ongoing government engagement referenced by the council, as exporters look for steps that can ease raw material availability and liquidity conditions.