The gems and jewellery export sector will finally see some respite as U.S. markets begin to turn positive. Financial year 2018-19 saw marginally higher exports at the rate of 3 per cent in spite of lower shipments to U.S. falling from 48 per cent to 37.4 per cent.

As the environment is beginning to stabilize, it is expected that State Bank of India and Indian Banks’ Association will offer some relaxation to exporters thanks to several pleas made by them. Following the nation-wide coverage of Punjab National Bank fraud amounting to $2 billion, several measures such as banning of letters of undertaking and tightening of security controls has made it extremely difficult to conduct business. While it has helped in identifying perpetrators, it has created several obstacles and unnecessary hassles for honest business owners.

Colin Shah, Vice Chairman, Gems & Jewellery Exports Promotion Council (GJEPC) said, “The banking sector's exposure to the gems and jewellery sector is mere 2.5-3 per cent of the overall requirement for the sector. The industry urges the banks to relax some norms for working capital lending to the sector. Time has come that the banking sector should look at the gems and jewellery sector in a serious manner.”

Weighed down by the severe bank restrictions on the entire gems and jewellery sector, there has not been much growth in the past year. However, signs of improvement have been noticed among the entire American retail market which posted their largest gain since September as the economic and financial outlook stabilized.

According to a report by Nation Retail Foundation (NRF), Americans are expected to spend 13 per cent more on jewellery this Mother’s Day. A sharp rise from 2018’s $4.6 billion spend, 2019’s expected spend is pegged at $4.6 billion. This accounts for 31 per cent growth in the jewellery sector for the occasion of Mother’s Day.

The Indian contribution to U.S. gems and jewellery demand was estimated at 16 per cent in the financial year 2019. Indian Exports have grown 3.97 per cent to $10.476 billion in FY2018-19 from $10.1 billion in FY 2017-18.

Several measures have been taken to increase transparency of business to drive growth relax credit flow to the industry. Exporters hope that these measures will help in facilitating the momentum that has been recently generated.