From shrimps to sparkle: Gems and jewellery show early resilience to US tariffs

While it is too early to conclude that Indian exporters have fully adapted to the new tariff regime, recent data suggests that the gems and jewellery sector—much like seafood earlier—may be showing early signs of resilience by tapping alternative markets

The steep tariffs imposed by the United States on Indian goods in August — cumulatively close to 50 per cent — were initially viewed as a major blow to India’s export push, an Economic Times report said on Tuesday.

The timing was especially difficult, as New Delhi has been pressing ahead with a manufacturing- and export-led growth strategy to cement its position as a global production hub.

Among the sectors widely expected to bear the brunt was gems and jewellery, given its heavy reliance on the US market.

For years, the US has been the largest destination for Indian gems and jewellery exports, with shipments valued at nearly USD 10 billion in 2023–24, The Economic Times notes, citing industry data. The sector is also labour-intensive, employing about 1.7 lakh workers across clusters such as Surat, Mumbai and Jaipur. With this exposure, the tariff announcement under President Donald Trump’s trade policy triggered fears of job losses, order cancellations and a longer-term erosion of competitiveness.

A few months later, however, the initial shock appears to be easing. While it is too early to conclude that Indian exporters have fully adapted to the new tariff regime, recent data suggests that the gems and jewellery sector—much like seafood earlier—may be showing early signs of resilience by tapping alternative markets, The Economic Times reports.

Media reports cited by The Economic Times, drawing on data from the Gem and Jewellery Export Promotion Council (GJEPC), show that exports from the sector rose 19.64 per cent year on year to USD 2.5 billion in November 2025, compared with USD 2.1 billion a year earlier. This uptick has fuelled cautious optimism within the industry.

The broader picture, though, remains mixed. For the April–November period, overall gems and jewellery exports were largely flat at USD 18.86 billion, only marginally higher than USD 18.85 billion in the same period last year, The Economic Times notes. This suggests that while November delivered a strong showing, it has yet to translate into sustained growth through the financial year.

Industry leaders attribute the recent improvement to demand revival outside the US. GJEPC chairman Kirit Bhansali told PTI that markets are stabilising and orders are picking up in regions such as Hong Kong, China and the Middle East, The Economic Times reports. Even as demand from the US remains subdued, stronger traction in these markets has helped offset some of the slowdown.

Bhansali also highlighted a sharp rise in exports of gold-studded jewellery, partly driven by higher job-work demand within India. This points to adjustments in supply chains and greater emphasis on value-added manufacturing as factors supporting export volumes despite external pressures, The Economic Times says.

Diversification echoes seafood playbook

The evolving trend in gems and jewellery mirrors the path taken earlier by India’s seafood sector. Shrimp exports, one of India’s most valuable categories, were also expected to suffer under US tariffs. Instead, exporters diversified quickly—reopening access to Australia after eight years, regaining entry into the European Union after nearly a decade, and expanding shipments to Russia and other emerging markets. This strategy reduced dependence on the US and helped blunt the tariff impact, The Economic Times reports.

A similar pattern may now be unfolding in gems and jewellery. A CareEdge report cited by The Economic Times observed that while exports to the US declined sharply, the drop was partly cushioned by higher shipments to the UAE, Hong Kong and China. At the same time, CareEdge cautioned that it remains too early to say whether this reflects a lasting shift in export geography or a short-term adjustment.

This tentative resilience has coincided with an improvement in broader trade indicators. India’s merchandise trade deficit narrowed sharply to USD 24.53 billion in November from USD 41.68 billion in October, driven largely by lower imports of gold, oil and coal, The Economic Times reports, citing Commerce Ministry data. Merchandise exports, meanwhile, rose 19.38 per cent year on year to USD 38.13 billion in November, suggesting that the export engine has not stalled despite a challenging global trade environment.

To soften the impact of US tariffs, the government has rolled out measures such as consumer tax cuts, export promotion packages and labour reforms, aimed at improving competitiveness and supporting export-dependent sectors, The Economic Times notes. Still, caution remains warranted. One strong month does not establish long-term immunity from tariff shocks.

Whether the current resilience evolves into a durable shift away from excessive reliance on the US will become clearer over the coming quarters. For now, the performance of sectors such as gems and jewellery offers cautious optimism rather than definitive proof of sustained insulation from trade disruptions, The Economic Times says.

One clear implication of this resilience is strategic. It strengthens India’s negotiating position by reducing pressure to conclude trade deals under duress. Commerce Minister Piyush Goyal has reiterated that India will not negotiate under deadlines or coercion, a stance reflected in the prolonged nature of talks, The Economic Times reports. With sectors like gems and jewellery, seafood and textiles showing adaptability, India’s hand in ongoing negotiations may be firmer. The visit of US Deputy Trade Representative Rick Switzer to India on December 10–11 to continue discussions, along with recent expressions of optimism from both sides, underscores the possibility of progress towards a deal—on terms India is less compelled to rush.