In the last fiscal year (ending in March 31 2006) export earning of Indian jewelry sector increased by 6.32%. When I first found the information, I thought that it was not a bad increase. However, then I came to know that the growth rate for the previous year was nearly 30% then I realized why everyone is not delighted with it. The export earning for India from this sector in the last fiscal year (2005-2006) was $16.67 billion while in the previous fiscal year (2004-2005) it was $15.68 billion. Bakul Mehta, chairman of GJEPC has blamed slowdown in the US market behind it.
40% of Indian jewelry export goes to USA. Rising gold price in the international market is another factor that slowed down Indian jewelry export.
The prospect of jewelry export is not very bright in the current fiscal year too. There is no sign of falling of the gold price. US market is not expected to grow strongly too. Recently, the Indian government has announced to bring changes in the tax system for the jewelry sector.
I think that India should explore new markets. Excessive dependency on the US market may bring disaster in future.
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