Jewellery exports may rise on Us-china tension

The US’ withdrawal of special status to Hong Kong could boost India’s jewellery exports to developed nations and help it become the world’s largest diamond trading hub, say experts. India processes 11 out of 13 rough diamonds mined globally. Shifting of business units from Hong Kong to India will further strengthen India’s position in the world diamond processing and jewellery manufacturing.

After China imposed a national security law on Hong Kong earlier this month, the United States on July 14 withdrew the special status granted to Hong Kong, and the United Kingdom, Australia, and Canada followed suit.

“This move will possibly create opportunities for India in gems and jewellery trade. For the US, Hong Kong and China are the fourth largest destinations of imports of gems and jewellery after India, France and Italy,” said Colin Shah, chairman of the Gems and Jewellery Export Promotion Council (GJEPC).

India’s gems and jewellery exports have taken a severe hit because of Covid-19 and the resultant lockdowns across the world. GJEPC data show exports declined by 55 per cent to a mere $2.7 billion in the first quarter of financial year 2020-21, compared to $6.07 billion in the corresponding period last year.

Hong Kong enjoyed a discounted export duty of 3.3 per cent on goods shipped to the US because of the special status, while a tax of 7.5 per cent is imposed on shipments from other countries.