【Mumbai, Indi】Indo-US Trade Agreement to Boost Gems and Jewellery Exports

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Editor’s Note

This report highlights a significant development for India’s gems and jewellery sector, following a key trade agreement with the United States. The industry anticipates the tariff reduction will stimulate trade and restore confidence, marking a positive shift for bilateral commerce.

Industry Welcomes Historic Agreement and Tariff Reduction

Mumbai, February 3 (Bhasha) The gems and jewellery industry on Tuesday welcomed the historic India-US trade agreement and the reduction of US tariffs to 18 percent. The industry argues that this will increase trade, restore confidence, and provide a strong boost to the entire sector.

An agreement has been reached between India and the US under which the US will reduce retaliatory tariffs on Indian goods to 18 percent. This success came after a telephone conversation between Prime Minister Narendra Modi and US President Donald Trump.

“Reducing the tariff to 18 percent will lower costs for US importers, provide significant relief to diamond jewellery manufacturers, enhance the competitiveness of Indian diamond jewellery, revive demand, and stabilize operations,” said Kirit Bhansali, Chairman of the Gem & Jewellery Export Promotion Council (GJEPC).

He said that GJEPC hopes that after India signs the trade agreement, rough diamonds and colored gemstones exported from the country to the US will benefit from zero-duty imports, which are part of the US retaliatory tariff list, providing crucial support for diamond exports.

Impact of Previous Tariffs

According to GJEPC data, in 2025, retaliatory US tariffs severely impacted trade with the US as duties on polished diamonds and colored gemstones increased from zero percent in April to 10 percent, and then to 50 percent by August, making these raw materials unprofitable and affecting working capital, cash flow, and margins.

Tariffs on jewellery increased from 5-7 percent to 55-57 percent.

Domestic Industry Reaction

On the domestic front, Rajesh Rokade, Chairman of the All India Gem & Jewellery Domestic Council (GJC), said the reduction in US tariffs is a significant moment for India’s gems and jewellery sector.

“The reduction in US tariffs is a major achievement that will directly benefit small and medium enterprises, which are the backbone of India’s jewellery industry,” said Avinash Gupta, Vice Chairman of GJC.

The India-US trade agreement is significant because many labor-intensive sectors such as textiles, apparel, leather, and marine products were facing challenges in exporting goods to the US due to the 50 percent tariff.

Relief for the Sector

Colin Shah, Managing Director of Kama Jewellery, said that reducing the tariff to 18 percent is a major relief for the Indian gems and jewellery sector and is welcome.

“The US has been a major consumer market for Indian gems and jewellery, and business was being impacted by the tariff effect. This ‘partial’ relief will restore confidence among Indian jewellery manufacturers and exporters as well as buyers in the US market,” he said.
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⏰ Published on: February 03, 2026