GEMS AND JEWELLERY Gems and Jewellery is an important emerging sector in the Indian Economy.

Ranked among the fastest growing sectors, it is also a leading sector for foreign exchange generation. The gems and jewellery industry is very much fascinating being traditionally glamorous and artistically modern. This business employees and engages millions; cover wide activities such as raw material procurement from far flung Africa, Australia, Canada and Russia, and transforming these into products in demand with the skills available in China, India, Italy and Turkey for the sophisticated markets in the USA, Europe, Far East, Middle East and Asia. India's Position in Gems and Jewellery Sector 1. Gems and Jewellery is one of India 's leading foreign exchange earning sectors. 2. It accounted for 16.7 per cent of India 's total Merchandise Exports. 3. USAs import of Gem & Jewellery from India increased by 50.5% in 2010 as compared to 2009. 4. India Gems & Jewellery exports are expected to grow at a whopping 15 to 20 per cent in FY 2011-2012. 5. At present India exports 95% of the worlds diamonds. Advantage India
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Gems and Jewellery hub Rich tradition / heritage of craftsmanship with high level of skills Low production costs Effective worldwide distribution network for promotion and marketing. Diamond polishing capital of the world. Manufacturing excellence

Key Industry Components Diamonds: Diamonds have always enjoyed a special place among precious gemstones. In the past, diamond jewellery was limited to a very small elite segment of the global population. However, over the past 50 years, diamonds have seen increasing democratisation. Diamond jewellery has, therefore, emerged as a segment showing significant growth in some of the emerging markets. Gold: Gold has always been the jewellers' favourite metal given its intrinsic lustre and ease of fabrication Gold jewellery enjoys the leading position in most markets across the world, and in many ways forms the backbone of the precious jewellery industry. Given the fact that gold is also one of the traded metals, gold jewellery consumption is also impacted by gold price movements. Coloured gemstones:

This segment includes all other forms of jewellery; precious gemstones (emeralds, sapphires, rubies and tanzanite) and semi-precious gemstones; silver, pearls, etc. The industry is highly fragmented making it difficult to track supply, demand and global trade. Exports During the Fiscal Year 2010-11, the total exports for gems and jewellery stood at US$ 43139.24 million as compared to US$ 29368.72 million during the fiscal year 2009-10. During the same period, the sector registered a growth of 46.89 per cent over the previous year. Composition of Exports
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Cut and polished diamonds: The export of cut and polished diamonds grew manifold in 2010-11 as compared to 2009-10. In 2010-11, the export of cut and polished diamonds was US$ 28251.92 million as compared US$ 18237.56 million, recording a growth of 54.91 per cent. Coloured Gemstones: Export of coloured gemstones was registered at US$ 314.54 million in 2010-11 as compared to US$ 286.78 million in 2009-10, showing a growth of 9.68 per cent. Gold Jewellery: Export of Gold jewellery also grew in 2010-11, registering US$ 12885.59 million as compared to US$ 9669.10 million in 2009-10. A growth of 33.27 per cent was recorded.

Net Exports of Gems and Jewellery items during April-October 2011 The summary of export of gems and jewellery items during April 2010-March 2011 as compared to same period last year Items April-October 2011 April-October 2010 % (Same ports as Growth/decline current year) over previous Year US$ in Million 14807.71 1209.24 5535.29 US$ 2.62 12.24 43.97

US$ in Million Cut & Pol Diamonds Gold Jewellery-D.T.A SEZ/EPZ (included Gold Jewellery & Gold Medallions and coins) Total Coloured Gemstones Silver Jewellery Others * 15195.08 1357.28 7968.97

9326.25 187.17 386.92 17.52

6744.53 158.45 284.18 9.08

38.28 18.13 36.15 92.95

Net Exports Exports of Rough Diamonds Others Total Exports

25112.94 995.65 51.45 26160.04

22003.95 580.44 31.96 22616.35

14.13 71.53 --15.67

Indian Precious Metals/Gems Industry The Indian Gems and Jewellery Industry is expected to grow by CAGR 13 per cent in next 2 years. Gold is driving the gems and jewellery export orders from India. According to the Investment Commission of India, exports are likely to grow to US$ 25 billion by 2012.

Surat is India's diamond processing hub, contributing over 80 per cent of the country's diamond processing industry with annual revenue of around US$ 13.03 billion.

It is predicted that the number of outlets selling platinum jewellery would increase to around 1,000 outlets in the next 2-3 years. Most platinum jewellery manufacturers are targeting 2040 years age group consumers with high disposable income. The Indian government has provided an impetus to the booming gems and jewellery industry with favourable foreign trade policies:

100 per cent foreign direct investment (FDI) in gems and jewellery through the automatic route is allowed, low import duty on platinum and exempt rough coloured precious gem stones from customs duty, rough, semi-precious stones are also exempted from import duty, duty-free import of consumables for metals other than gold and platinum up to 2 per cent of freight on board (f.o.b) value of exports, raised limit value of jewellery parcels for export through foreign post office from US$ 50,000 to US$ 75,000 and the time period for re-import of branded jewellery remaining unsold has been extended from 180 days to 365 days, export of coloured gemstones on a consignment basis has been allowed. The government has announced a series of measures to help gems and jewellery exports in the Foreign Trade Policy 2009-14, neutralised duty incidence on gold jewellery exports, to allow duty drawback on such exports, "Diamond Bourses", grading/certificate, export of gems and jewellery products, the value limits of personal carriage have been increased from US$ 2 million to US$ 5 million in case of participation in overseas exhibitions. The limit in case of personal carriage, as samples, for export promotion tours, has been increased from US$ 0.1 million to US$ 1 million.