US tariffs threaten over 1L jobs in India's jewelry sector
What's the story
US President Donald Trump has announced a 25% tariff on Indian imports, effective from August 1. The move is likely to have a major impact on India's gem and jewelry exports, which were worth $9.9 billion last year. Industry leaders have warned that the new tariff could put over one lakh jobs at risk in the sector.
Impact on exports
Handmade jewelry exports may be hit hard
Rajesh Rokde, Chairman of the All India Gem and Jewelry Domestic Council, has expressed his concerns over the new tariff. He said that handmade jewelry exports could be hit hard by this move. "These products may no longer be accepted or sold there," he warned while stressing that the impact could be worse than when a 10% tariff was imposed earlier.
Job impact
'Previous tariff hike led to job losses'
Rokde further highlighted that the previous tariff had an adverse effect on employment in the sector. "Around 50,000 people were suspected to be unemployed," he said. If this trend continues with the new tariff hike, over one lakh people could be affected this time around. "Such an outcome would be very unfortunate for the jewelry industry," Rokde added.
Market significance
US is a major market for Indian gems and jewelry
According to data from the Ministry of Commerce, the US is one of the largest markets for Indian gems and jewelry. The country exported jewelry worth $9.9 billion to the US in the last fiscal year. Colin Shah, Managing Director of Kama Jewelry, also voiced concerns over Trump's decision to impose a tariff on Indian imports.
Ongoing struggles
Prolonged geopolitical tensions and Trump's tariff threats spell disaster
Shah said that the move will severely impact sectors like gems and jewelry, which are heavily dependent on exports. He also noted that the industry has been struggling for over two years due to prolonged geopolitical tensions between Russia and Ukraine, and the Middle East. "With Trump's tariff threats, uncertainty has returned in Indian markets," Shah said while expecting muted trade activities with the US going forward.
Future prospects
Hope rests on upcoming India-US bilateral trade agreement talks
Despite the challenges, industry stakeholders are hopeful about the upcoming sixth round of India-US Bilateral Trade Agreement (BTA) talks. Scheduled for the end of August, these discussions could bring some relief or a deal when US counterparts arrive in India. The jewelry industry is looking forward to these talks as a potential way out of the current crisis caused by Trump's tariff imposition.