India’s gems and jewellery exports fall 35% in March 2026

What changed for exporters in March

India’s gems and jewellery exports fell sharply in March 2026 as the West Asia conflict disrupted air routes, shipments and insurance costs. The Gem and Jewellery Export Promotion Council (GJEPC) said the sector’s exports declined 35.23% year-on-year to $17.72 billion in March. A year earlier, exports in March 2025 were $18.67 billion, based on GJEPC data.

The decline matters because West Asia and the Gulf supply chain influences both demand and the movement of high-value, time-sensitive parcels such as diamonds and jewellery. Industry executives said the disruption was not limited to one corridor, with Dubai acting as a hub for shipments that eventually move across Gulf Cooperation Council (GCC) markets.

GJEPC on logistics, insurance and stuck diamond parcels

GJEPC chairman Kirit Bhansali told PTI that logistics disruptions were a key driver of the March decline. He said even diamond export parcels were unable to move through affected routes.

Bhansali also pointed to a jump in insurance premiums as the situation turned “high-risk”, adding to shipment costs and discouraging dispatches. In the gems and jewellery trade, where consignments often move by air rather than sea, repeated airspace restrictions and airport closures can lead to immediate delays, rescheduling costs and customer delivery uncertainty.

Cut and polished diamond exports also fell

The impact was visible in the cut and polished diamonds (CPD) segment. CPD exports declined 27.48% in March to $1.84 billion, compared with $1.16 billion in the same month of the previous year, according to the data cited.

With diamonds moving primarily through flight cargo networks, any disruption in West Asia can slow both export dispatches and trading activity. The broader supply chain link is important because Dubai is described as a major hub for rough and polished diamonds and bullion, and disruptions there affect India’s ability to move goods quickly to buyers.

FY26 exports dipped 3.32% despite weaker demand in the US and China

On a full-year basis, GJEPC said gems and jewellery exports in FY26 dipped marginally by 3.32% to $17.72 billion, compared with $18.67 billion in FY25.

Bhansali said the impact of US tariffs was partly offset as GJEPC explored other markets. He also said that demand in the US weakened after tariff imposition, while China saw pressure due to economic conditions. At the same time, stronger demand from the GCC, the UK and the European Union helped reduce the overall hit, based on his comments.

Dubai’s hub role raises concentration risk

Separate industry commentary in the provided material underscored how concentrated the trade route has become. Dubai acts as a distribution hub, with shipments first reaching Dubai and then being routed across GCC destinations. As a result, a disruption in Dubai can spill over into multiple markets at once.

In the same material, GJEPC executive director Sabyasachi Ray said the ongoing conflict was expected to hit $1.0 billion worth of gems and jewellery exports in the near term. He added that $1.8 billion of goods could be diverted, while $1.2 billion could not be diverted “anywhere”. Ray also said 20% of the gems and jewellery trade would be affected in March due to the war.

Export market mix: US and UAE numbers in focus

The market mix highlights why the West Asia corridor is closely tracked by exporters and investors. The provided material said India exported $19.0 billion worth of gems and jewellery in FY25. It also stated that the US was the biggest market at $1.24 billion of exports, followed by the UAE at $1.87 billion.

It added that after US tariffs, the UAE emerged as India’s biggest export market for gems and jewellery, importing $1.33 billion so far in the ongoing fiscal year. Ray warned that if Dubai is affected, $1.3 billion worth of exports are affected, noting Dubai takes significant volumes of “chunky gold jewellery” that is difficult to offload into alternate channels quickly.

Gold jewellery stayed flat in FY26

GJEPC provisional data in the material showed total gold jewellery exports in FY26 were broadly flat at $11.36 billion versus $11.37 billion in the previous year. This signals that the broader decline is not uniform across all product categories, and that a segment-specific lens remains important for tracking the sector during periods of geopolitical disruption.

Rough diamond trading hub: the strategic push

Bhansali said policy support could turn the disruption into an opportunity by positioning India as a rough diamond trading hub. The material also noted that since 2020, the UAE has become a rough diamond trading hub due to its accessibility to India.

In another account, Bhansali said about 90% of India’s rough diamonds come from Dubai, and that shifting auction and trading activity to India could be explored if the conflict persists. The same material referenced two bourses, one in Mumbai and the other in Surat, as part of the ecosystem that could support more onshore trading if ease-of-doing-business measures are aligned.

What to watch next

Bhansali said the council expects geopolitical tensions to settle down in another 2-3 months. He also said GJEPC would continue to explore new export markets to reduce dependence on any single region.

For the near term, the sector’s operating variables remain logistics availability, insurance pricing and the ability to re-route consignments without losing delivery commitments. These factors can influence shipment timing and working capital cycles for exporters, especially in diamonds where delays can be costly.

Key numbers at a glance (all values in USD billions)

Why the disruption matters for India’s export engine

The gems and jewellery trade is highly exposed to sudden regional closures because high-value parcels are frequently moved by air. The provided material also stated that the Middle East accounts for nearly a quarter of India’s annual gems and jewellery exports of around $10 billion, and that the UAE supplies more than two-thirds of India’s rough diamond imports.

That combination makes West Asia not just a demand region but also a routing and sourcing region. When air corridors tighten, exporters face immediate shipment delays and higher costs, while manufacturers can also face uncertainty over rough supplies that feed cutting and polishing centres.

Conclusion

India’s gems and jewellery exports weakened in March amid West Asia conflict-driven logistics disruption, with CPD exports also falling year-on-year. GJEPC expects tensions to ease in 2-3 months and says it will keep diversifying markets, while also pushing for policy support to expand rough diamond trading activity in India.