Arvani Jewels

India’s Gem & Jewelry Trade Dips in June 2024

India’s Gems and Jewellery Export Promotion Council (GJEPC) has released its June 2024 data, revealing a significant downturn in the country’s rough and polished diamond trade, Rough & Polished reports.

Overall gross exports of gems and jewelry dropped 14.8% year-to-year to $1.9 billion. After two months of growth, total gross imports of precious stones also declined in June, falling 16.5% to $1.55 billion. The first quarter of the new financial year, which began on April 1, showed a 7.44% decrease in exports year-on-year, with a slight 2.9% increase in imports.

Polished diamond exports in June fell sharply by 26.35% year-to-year to $1.02 billion. Imports of polished diamonds fell 35.9% to $77.25 million.

For the first quarter of the 2023-2024 financial year, India imported rough diamonds worth $3.39 billion, a 15.4% decrease for the same period last year. Gross exports of lab-grown diamonds (LGD) in June 2024 fell 8.96% to $88.83 million.

World Gold Council Study: US Elections Impact Gold Demand and Price Volatility

The World Gold Council’s latest report, “Ballots to Bullion: Examining the US Election’s Effect on Gold,” explores the correlation between US presidential elections and gold prices

Historically, gold has been considered a safe-haven asset during political uncertainties like elections. The report indicates that gold prices tend to fluctuate around US elections due to changes in investor sentiment and market dynamics.

The study highlights that during election years, geopolitical uncertainties and potential policy shifts can significantly influence gold prices. Investors often seek gold as a hedge against economic instability, leading to increased demand and rising prices. This trend has been evident across multiple election cycles, with notable price movements tied to polling data, election results, and anticipated policy changes.

The report also considers the broader economic environment, pointing out that factors such as inflation, interest rates, and fiscal policies from new administrations can greatly impact gold's attractiveness. Particularly, expansive fiscal policies or increased government spending may heighten inflation concerns, thereby boosting gold’s appeal as an investment.

India Unveils Landmark Tax Reforms to Boost Diamond Industry

India's diamond industry is celebrating a series of measures introduced in the July budget, which are set to facilitate direct diamond sales from foreign mining companies and lower taxes on crucial raw materials

Finance Minister Nirmala Sitharaman announced the implementation of safe harbour rates, offering fixed and favourable tax rates for rough diamond purchases within the country's Special Notified Zones (SNZs). This move simplifies the taxation process and mitigates unforeseen liabilities for foreign suppliers.

In addition, Sitharaman revealed significant tax reductions on precious metals: gold and silver will now have a tax rate of 6%, and platinum will be taxed at 6.4%. Furthermore, diamond sales will be exempt from the 2% equalisation levy, promoting sustainability within the industry.

"India is a global leader in the diamond cutting and polishing industry, which employs a substantial number of skilled workers," Sitharaman stated in her Budget speech. "To further support this sector, we will establish safe harbour rates for foreign mining companies selling raw diamonds in India."

Vipul Shah, chairman of the Gem and Jewellery Export Promotion Council (GJEPC), praised the government's decisions, stating, "The reduction of customs duty on gold and silver, the exclusion of the diamond sector from the 2% equalization levy, and the simplification of taxation rules in SNZs for rough diamonds will solidify India's leadership in the global gems and jewellery industry."