FTA likely to drive 150% surge in jewellery exports to UK

India’s gems and jewellery exports to the UK are expected to see a sharp rise from the current US$ 941 million to $2.5 billion over the next two years, driven by the India-UK Free Trade Agreement, according to the Gems and Jewellery Export Promotion Council (GJEPC).

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The proposed India-UK Free Trade Agreement (FTA) is poised to redefine the dynamics of gems and jewellery exports from India, offering a substantial boost to the sector. With Indian exports to the UK currently standing at US$ 941 million, experts estimate this figure could soar to approximately US$ 2.5 billion within the next two years following the implementation of the FTA. This dramatic upswing is expected to significantly strengthen bilateral trade ties, foster investment, and enhance collaboration between the two nations.

Kirit Bhansali, Chairman of the Gems & Jewellery Export Promotion Council (GJEPC), emphasized the transformative potential of the deal. “The agreement will open up new opportunities for growth, investment and collaboration, strengthening trade between the two nations,” he said. One of the key features of the FTA is the elimination of the UK’s existing tariffs of up to 4% on Indian gems and jewellery, a move that is expected to significantly improve the competitiveness of Indian products in the UK market.

Bilateral trade in the gems and jewellery sector, which currently hovers around US$ 3.6 billion, is projected to double to nearly $7 billion in the coming years. Imports from the UK to India, currently valued at US$ 2.7 billion, could also grow to US$ 4.3 billion, opening up mutual benefits for both markets.

Industry leaders are optimistic about the timing of the deal. An official at PC Jeweller noted that the trade pact arrives at a crucial moment when traditional markets like the US and China are witnessing a slowdown. “The UK was a smaller export market versus the US and China so far. It will increase significantly with this trade deal,” the executive said. This sentiment is echoed across the industry, with many seeing the UK as an emerging avenue of opportunity.

Jayant Ranige, CEO of UK-based PureJewels by Bhanji Gokaldas, believes the deal will spur artistic and cultural collaboration. “The doors to innovation and collaboration with artisans will increase,” he remarked. “This will open up the possibility of showcasing the shared legacy of Indian and British craftsmen.” With a substantial South Asian diaspora in the UK and a robust demand for luxury jewellery, Indian brands like Kalyan Jewellers and Malabar Gold and Diamonds have already established a presence there. More major retailers are expected to follow suit, capitalizing on the tariff-free access and a highly receptive market.

Bhansali highlighted the benefits for Indian artisans and MSMEs, noting that the UK’s high spending potential and affinity for luxury jewellery would provide a valuable platform for smaller Indian businesses. “The FTA will also come in handy for Indian artisans and small-scale businesses,” he said.

Vipul Shah, CEO & Managing Director of Asian Star Jewellery, underscored the positive implications for employment within India’s Santacruz Electronics Export Processing Zone (SEEPZ), which houses over 180 gems and jewellery processing units. “With the prospects of increased exports of studded jewellery and other precious metals to the UK, their jobs will be safeguarded,” he said, addressing concerns about job security amid global demand challenges.

Alkesh Shah, Vice Chairman of Goldstar Jewellery, pointed out that the studded and gold jewellery segments stand to gain the most from the FTA. “We can comfortably predict a 10-15% year-on-year growth for our UK exports, maybe even more,” he projected.

Colin Shah, Managing Director at Kama Jewellery, added that the trade agreement would give Indian exporters a significant edge over global competitors. “The FTA will provide Indian exporters preferential access to the UK over competitors like China and Thailand,” he noted.

As negotiations near conclusion, the India-UK FTA holds the promise of a golden era for the gems and jewellery sector, breathing new life into exports, empowering artisans, and reaffirming India’s position as a global leader in fine jewellery.