India Sees Jewelry Exports Doubling as US Tariff Lifted

Indian jewelry exports to the United States are forecast to show a strong increase in the coming financial year following the lifting by the US of a 5.7 percent tariff on finished jewelry from India.

The cancellation of the US duty could lead to Indian jewelry exports to the world’s largest market doubling to $1.2 billion by 2005, according to some Indian exporters.

And Indian exporters are reportedly boosting jewelry operations in an effort to benefit from the lifting of the US tariff.

This includes working with larger stones, creating more intricate settings and using more modern machinery rather than having thousands of employees working with small gems and simple settings which do not bring substantial added value to companies.

In addition, some Indian firms that set up foreign operations despite higher labor charges abroad in order to benefit from not paying the US tariff are planning to bring their production back to India following the lifting of the duty.

Meanwhile, the keeping in place of a tariff of up to 6.6 percent on Chinese jewelry exports is expected to help Indian exports by making them more competitive.

However, Indian exporters believe the duty Chinese exporters pay may be lifted in the near future following China’s admittance to the World Trade Organization thus canceling India’s competitive advantage.