India-US Trade Pact: Gems, Jewellery Sector Sees Export Boost as US Tariffs Drop to 18%

The gems and jewellery industry on Tuesday welcomed the landmark India-US trade agreement and the reduction of US tariffs to 18 per cent, saying this will enhance trade flows, rebuild confidence, and deliver a strong sector-wide boost.

India and the US have agreed to a trade deal under which Washington will bring down the reciprocal tariff on Indian goods to 18 per cent. The breakthrough follows a high-level telephonic conversation between Prime Minister Narendra Modi and US President Donald Trump.

"Tariff cuts to 18 per cent will lower costs for US importers, provide immense relief to diamond jewellery manufacturers, boost the competitiveness of Indian diamond jewellery, revive demand, and stabilise operations," the Gem and Jewellery Export Promotion Council (GJEPC) chairman Kirit Bhansali said.

He said, GJEPC is optimistic that, based on India signing the trade deal, loose diamonds and coloured gemstones from the country will get the benefit of zero duty imports in the USA as part of the US reciprocal tariff list, which will provide much-needed support for diamond exports.

According to GJEPC data in 2025, reciprocal US tariffs disrupted trade flows to the US sharply as duties on polished diamonds and coloured gemstones surged from zero 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 5-7 per cent to 55-57 per cent.

On the domestic front, All India Gem and Jewellery Domestic Council (GJC) chairman Rajesh Rokde said the reduction in US tariffs marks a pivotal moment for India's gems and jewellery sector.

"By lowering barriers in one of the largest consumer markets, our exporters will gain a stronger foothold, while our artisans will see their creations reach new audiences," he noted.

The India-US trade agreement reduced reciprocal US tariffs on Indian goods from 25 per cent to 18 per cent, removing a major overhang that had weighed on export-oriented sectors.

GJC Vice Chairman Avinash Gupta said, "The slash in US tariffs is a landmark achievement that will directly benefit small and medium enterprises, which form the backbone of India's jewellery industry." This reduction opens doors for thousands of smaller businesses to expand into the US market, translating into higher exports, stronger revenues, and most importantly, job creation at the grassroots level, he added.

The India-US trade deal assumes significance as several labour-intensive sectors like textiles, apparel, leather and marine were facing challenges to export goods to the US due to the 50 per cent tariffs.

Kama Jewelry MD Colin Shah said, the reciprocal tariffs being slashed to 18 per cent come as a great relief to the Indian gems and jewellery sector and are well-received.

"The USA has been a prominent consumer market of Indian gems and jewellery, and the sentiment had taken a hit due to the tariff implications. This partial relaxation will reinstate confidence in Indian jewellery manufacturers and exporters, as well as the buyers in the American market," he added.

Akoirah by Augmont founder Namita Kothari said, the US tariff correction from 50 per cent to 18 per cent is a meaningful policy shift for India's gems and jewellery sector, as it directly improves export economics in one of our most critical overseas markets.

Importantly, it is also a timely positive for the laboratory-grown diamond ecosystem, as the US is the largest gem and jewellery market globally, with laboratory-grown diamonds gaining market share, especially among younger consumers, therefore, improved tariff economics can support shipment momentum and offer relief to manufacturers operating on thin spreads, she added.