India’s gems and jewellery industry has a cloud on the horizon. The U.S., one of India’s biggest buyers, is imposing steep tariffs on certain gold and silver jewellery items. Exporters are feeling the pinch. But even as doors threaten to close in one direction, another may be opening. The proposed free trade agreement (FTA) with the UK could give the industry a timely lifeline. With the UK market showing a steady appetite for Indian craftsmanship, the pact could become a golden gateway for exporters seeking to diversify beyond traditional strongholds.

The India–UK FTA can redefine the landscape for Indian gem and jewellery exporters, especially those aiming to expand into the high-potential UK luxury market. According to Piyush Gupta, Director at PP Jewellers by Pawan Gupta, the deal is a “big step” forward that brings tangible benefits to India’s traditional strengths in gold jewellery, diamond-studded pieces, and intricately handcrafted designs.

According to the Gem & Jewellery Export Promotion Council (GJEPC), the sector saw a significant trade growth by the end of the financial year 2024-25. Exports from the sector rose by 10.6% to$ 2.90 billion, up from $ 2.62 billion in March 2024, with a 15.5% rise in rupee terms. Overall, the total trade in gems and jewellery grew by 29.4% to $9.64 billion in March 2025, up from $7.45 billion during the same period last year.

The U.S. remained India's largest export destination for gems and jewellery, accounting for approximately $11.58 billion in exports. However, the imposition of a 26% retaliatory tariff by the Trump administration poses significant challenges to the sector. This tariff, particularly impacting loose diamonds (previously duty-free) and gold jewellery (which already faced 5.5-7% duties), led to a sharp decline in exports.

Conversely, exports to the UK showed a promising trajectory. In 2024, India's gems and jewellery exports to the UK stood at $941 million, including $400 million in jewellery alone. The signing of the India-UK FTA is expected to further improve this trade relationship, with projections indicating that exports could rise to $2.5 billion within two years, according to reports. The FTA aims to relax import duties on jewellery in the UK, which will enhance India's market access and potentially increase bilateral trade in the sector to $7 billion, per the GJEPC report.

“With the removal of tariffs, our products become far more price-friendly in the UK,” Gupta said, adding that this positions Indian jewellers strongly among UK consumers who value unique, culturally rich craftsmanship. The FTA eliminates export duties that once weighed down prices, giving Indian designs a much-needed edge in a competitive market long dominated by players like China, Thailand, and Turkey.

"A handcrafted gold necklace from India, for instance, can now be offered at a more competitive rate, tipping the scales in favour of Indian artisans who are already admired for their detailing and artisanal precision. This tariff-free access gives Indian exporters a clear pricing advantage,” Gupta noted.

But to truly capture the UK market, Gupta believes Indian manufacturers must step up their game. “UK customers value more than just beauty,” he said. “They care about quality, ethical sourcing, and modern styling.” For exporters, that means investing in certified materials, sustainable practices, and trend-forward collections that resonate with evolving luxury tastes.

Beyond sales, the FTA also opens doors to strategic collaborations. Gupta envisions a new era of co-branded collections between Indian craftsmen and British luxury retailers. “Our artisans offer unmatched handmade techniques, while UK brands provide global visibility—a win-win,” he said.

However, the journey will not be without its hurdles. From compliance to hallmarking and labelling norms to ensuring timely deliveries and meeting documentation requirements, Indian exporters must stay vigilant. “With good preparation and clear communication, these challenges can be easily managed,” Gupta assured.

However, as the country gears up to shine brighter on the global jewellery map, the FTA with the UK could well be the golden thread that ties tradition to opportunity, pushing Indian craftsmanship onto a larger stage.