【India】India’s Jewellery Industry Plans Global Pivot After Trump’s Tariffs: Will Dubai Be the New Hub?

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Editor’s Note

This article highlights the immediate ripple effects of recent US tariff increases on India’s export-driven sectors, with the gem and jewellery industry actively exploring manufacturing shifts to circumvent the new 50% duty. Upcoming bilateral talks between industry delegations will be a key development to watch.

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SUMMARY

India’s gem and jewellery industry is considering shifting manufacturing to low-tariff countries like Dubai and Mexico after the US doubled tariffs on Indian imports to 50%. A delegation from the US gem and jewellery industry is scheduled to visit India on August 19 to hold discussions with industry representatives and officials from India’s commerce ministry.
US President Donald Trump’s decision to double the existing tariffs on Indian goods to 50% has triggered alarm across India’s export sectors. The tariff hike affects several Indian exports, including gems and jewellery ($12 billion), textiles and clothing ($10.3 billion), shrimp ($2.24 billion), leather and footwear ($1.18 billion), chemicals ($2.34 billion), and machinery ($9 billion).

Industry Reaction

Colin Shah, MD, Kama Jewelry, termed the move as a severe setback for Indian exports, with nearly 55% of India’s shipments to the US market directly affected.

“Many export orders have already been put on hold as buyers reassess sourcing decisions in light of higher landed costs. For a large number of MSME-led sectors, absorbing this sudden cost escalation is simply not viable. Margins are already thin, and this additional blow could force exporters to lose long-standing clients,” Shah said.
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The gem and jewellery industry is reportedly considering relocating manufacturing to low-tariff nations such as the United Arab Emirates and Mexico to retain access to its largest market.
Kirit Bhansali, chairman of the Gem & Jewellery Export Promotion Council (GJEPC), described the tariff increase as “doomsday” for the sector.

“We will reroute our products through other countries after studying the tariff structure of that country with the US. We will set up manufacturing units there quickly,” The Economic Times quoted Bhansali as saying.
“Dubai is the nearest destination for us. We will also look into rerouting studded jewellery through Mexico, if required. However, we will do everything legally.”
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India’s largest jewellery maker, Titan Company, is also considering shifting some of its production to the Middle East, according to media reports.

Market Context and Impact

The US is the biggest market for Indian diamonds and studded jewellery, which recorded exports worth $10 billion in the 2024–25 fiscal year.
A delegation from the US gem and jewellery industry is scheduled to visit India on August 19 to hold discussions with industry representatives and officials from India’s commerce ministry.
According to Adil Kotwal, president of the SEEPZ Gems and Jewellery Manufacturers Association, orders from the US have dried up.

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“The little bit orders that we got before August 7 have been shipped,” he said.
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⏰ Published on: August 07, 2025