Indian G&J industry disappointed with Budget 2026 as import duty cut on gold / GST rationalisation was not addressed
February 3, 2026
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February 4, 2026Indian G&J industry welcomes deal, sees tariff cuts boosting export growth
Of late, the United States’ tariffs have sharply disrupted trade flows to the USA for the country’s gem and jewellery sector.In 2025, reciprocal US tariffs sharply disrupted trade flows to the USA. Duties on polished diamonds and coloured gemstones surged from 0 per cent to 10 per cent in April, then to 50 per cent by August, unviable for these raw materials, which strained working capital, liquidity, and margins. Jewellery duties jumped from 5 to 7 per cent to 55 to 57 per cent.
The high tariffs led to a 44.42 per cent plunge in India’s gem and jewellery exports to the US from April to December 2025 (USD 8,691.25 million to USD 3,862.08 million), with key categories hit hard. Cut and polished diamonds (-60.11 per cent) , studded gold jewellery (-24.54 per cent) and plain gold jewellery (28.89 per cent) were the most affected categories.
However, the recent US-India trade deal offers vital relief to the sector with tariff reduction from 50 per cent to 18 per cent. Tariff cuts lower costs for US importers, provides relief to diamond jewellery manufacturers, boost competitiveness of Indian diamond jewellery, revives demand and stabilises operations.
