This document is a project report on the gems and jewelry industry in India. It discusses the objectives and importance of studying this industry, provides background on the size and growth of the Indian gems and jewelry market, outlines various government initiatives to promote the industry, and discusses the significant role the industry plays in the Indian economy by contributing around 7% to India's GDP and employing over 4.64 million workers.

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PROJECT REPORT
ON
GEMS & JEWELRY INDUSTRY
By,
[BHAVIK VINODBHAI KHAKHKHAR – 91600425023]
REPORT GUIDE:
[Dr. PUJA VORA]
A Project Submitted to
Marwadi University, Rajkot.
In Partial Fulfillment of the Requirements for the
[BACHELOR OF BUSINESS ADMINISTRATION – Hons.]
July – 2018

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PREFACE
This project has been prepared in partial fulfillment of the BIFLG subject viva.
In this project we have done in - depth analysation work of GEMS & JEWELLRY
Industry to avail knowledge in the interested field for future compliances as
well as interested sector knowledge to give an edge in academic educational
learning process. This inturn will be helping to have a deep insight and broader
perspectivefor GEMS AND JEWELRY INDUSTRY. It’s strength and weakness are
known through stastics and experts the solution for it. Hence, it has been an
informative and helpful project.

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ACKNOWLEDGEMENT
We have taken efforts in this project. However, it would not have been possible
without the kind support and help of many individuals and organizations. I would
like to extend my sincere thanks to all of them.
First and foremost, I would like to express my gratitude & respect to my
honourable, GUIDE Proff. PUJA VORA for their constant guidance, advice,
encouragement & every possible help in the overall preparation of this report.
Overall, I am thankful to my family for supporting me and MARWADI UNIVERSITY
for providing such an opportunity for gaining theoretical knowledge in field of
GEMS & JEWELRY Sector through this project.

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EXECUTIVE SUMMARY
The project was been conducted to know in depth about a particular sector under
BRAND INDIA as to get in depth knowledge. Undergoing process for the project
has helped us to have deep insights for the GEMS & JEWELRY industry in India and
its perfomance in past, as well as predictions for future growth. Also how this
industry has flourished in foreign countries is tremendeous especially for
DIAMONDS wherein from every 12 Diamonds of world 11 are being polished in
India. Certain govt. Initiatives has also played and initial role in developing GEMS
& JEWELRY industry in INDIA and establishing its firm presence outside INDIA also
like Gold monetization schemes, 100% FDI, fiscalincentives, and lot more. Looking
forward to economic presence in country this industry generates employement of
4.5 million people all along, and contributes 7% of total INDIA’s GDP and stats.
16% of industries CAGR. This is glimpse of notable things learnt from the project.

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1.Introduction
The Gems and Jewellery sector play a significant role in the Indian economy,
contributing around 7 per cent of the country’s GDP and 15.71 per cent to India’s
total merchandise exports. It also employs over 4.64 million workers. One of the
fastest growing sectors, it is extremely export oriented and labor intensive.
Based on its potential for growth and value addition, the Government of India has
declared the Gems and Jewellery sector as a focus area for export promotion. The
Government has recently undertaken various measures to promote investments
and to upgrade technology and skills to promote ‘Brand India’ in the international
market.
India is deemed to be the hub of the global jewellery market because of its low
costs and availability of high-skilled labor. India is the world’s largest cutting and
polishing center for diamonds, with the cutting and polishing industry being well
supported by government policies. Moreover, India exports 75 per cent of the
world’s polished diamonds, as per statistics from the Gems and Jewellery Export
promotion Council (GJEPC). India's Gems and Jewellery sector has been
contributing in a big way to the country's foreign exchange earnings (FEEs). The
Governmentof India has viewed the sector as a thrust area for export promotion.
The Indian government presently allows 100 per cent Foreign Direct Investment
(FDI) in the sector through the automatic route.
Market size
Gold demand in India rose to 737.5 tones between 2017. India's gems and
jewellery exports stood at US$ 32.71 billion in FY2018. During the same period,
exports of cut and polished diamonds stood at US$ 23.73 billion, thereby
contributing about 72.55 per cent of the total gems and jewellery exports in value
terms. Exports of gold coins and medallions stood at US$ 1,917.09 million and
silver jewellery export stood at US$ 3,385.65 million during FY2018.

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The gems and jewellery market in India is home to more than 300,000 players,
with the majority being small players. Its market size is about US$ 75 billion as of
2017 and is expected to reach US$ 100 billion by 2025. It contributes 29 per cent
to the global jewellery consumption.
India is one of the largest exporters of gems and jewellery and the industry is
considered to play a vital role in the Indian economy as it contributes a major
chunk to the total foreign reserves of the country. UAE, US, Russia, Singapore,
Hong Kong, Latin America and China are the biggest importers of Indian jewellery.
The Goods and Services Tax (GST) and monsoon will steer India’s gold demand
going forward.

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2.OBJECTIVE
Retailers in India have started selling their jewellery online. The growth of online
jewellery is driven by increasing internet penetration rates, growth in high net
worth individuals’ population and availability of low online jewellery prices.
Majority of the players in the Indian market have started selling jewellery online;
for Ex. Malabar Gold, Tanishq, Tribhovandas Bhimji Zaveri, PC Jeweller, etc.
Companies are also giving buy back option to customers on jewellery within
certain days after the purchase and based on certain terms and conditions.
Companies have also started providing financial facility to their customers who
cannot afford to pay the whole amount at once.
The increase of middle class population symbolizes an increase in income of the
population; and income is a major driver of demand for gold and jewellery in
India.
As income rises, so does savings and Indians prefer buying gold with their savings
as they consider gold as an important form of investment.
In 2016, India’s gold demand stood at 666.1 tones; and 298.4 tones between
January-June 2017.

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3.NEED OF THAT PROGRAMME IN CURRENT SCENERIO
 The demand for jewellery in India is unique and to some extent inelastic to
price. Part of the relative inelasticity of gold demand to price is explained by its
religious and cultural significance, which is purchased for ornamentation and
gifting purposes, both of which are deeply ingrained in the Indian cultural
psychology. Growing domestic demand is a factor of: - Growing spending power; -
Role of jewellery in weddings; and - Gold as an investment
 India processes diamonds at the cheapest rates in the world, which makes it the
most competitive globally - per carat diamond processing cost in India being 1$10
(2011). In-born artisanalskills passed down from generation to generation and an
abundance of an informally trained skilled workforce makes labour cheap due to
the inherent competition.
 Better designs, new ranges and innovative marketing are the factors
contributing to the growth of the organised sector. Modern ways of
segmentation, targeting consumer segments with specific designs and exclusive
ranges and new usage styles attract a new set of consumers and create new
markets.
 The ‘Gold Tourism’ circuit proposed by the World Gold Council to boost the
production and sales of handcrafted jewellery made in India is a huge opportunity
for the industry. Such jewellery is a favourite among tourists and fetches a better
price than machine made jewellery. This move is expected to generate immense
employment opportunities in the sector.
 Government rules and policy interventions are pivotal to the growth of the
industry. The Indian Government is taking all possible initiatives for this industry.
These include the proposed Gold Monetisation Scheme, development of special
economic zones, etc.

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4.TARGET AUDIENCE/TERROTORY
 The brand’s target audience maybe women but the brand clearly
understands the other important influencer while buying decisions are
taken. It has therefore smartly placed its marketing effort by including men
in their campaign and directing the activity towards them.
 Usually jewellery brands communicate directly to their female customer
segment for promoting their products, but this is the first time an Indian
jewellery brand has broken the stereotype
.
 This brand seems to have planned this very astutely, getting the attention
of their fans as well as their loved ones. It has ensured a sure shot way of
striking an emotional connect with the audience.
 The market sentiment is improving, according to him, and the council is
expecting an increase in demand for gold jewellery due to forthcoming
marriage season.
 India’s gems and jewellery business is a sterling example of the
government’s ‘Make-in-India’ initiative, contributing around 7 percent of
the country’s GDP, according to Khandelwal.
 It provides jobs to more than 46 lakh people of the country, thus making
significant contribution to the country’s socio-economic framework, he
claimed.
 The All India Gems & Jewellery Domestic Council (GJC) has drawn up a
roadmap for adding 2 million new jobs in the gems and jewellery sector,
including 40 percent of the new jobs for women, said Khandelwal.
 West Bengal government has already allotted land sized 25,000 sq. ft for a
gem and jewellery park at Ankurhati, Domjur and Maharashtra government
has proposed a gems and jewellery park on a 25-acre land in Navi Mumbai.
 “We are also looking at setting up training centres across the country,” he
said.
 The association hopes to bring 100 percent gems and jewellery trade under
the organised platform from 60 per cent at present after successful
implementation of the goods and services tax (GST).

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 On the pricing front, Khandelwal said uncertainty has gone up following the
trade war between the US and China, resulting in a climb in gold prices.
 “Prices are expected to remain firm in the April-June quarter, and may
even touch USD 1,450-1,500 a troy ounce. In the domestic market, the gold
price is expected to touch Rs 33,000 to Rs 34,000 per 10 grams by mid-2018
from Rs 30,600 at present.”

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5.PROMOTIONAL STATEGIES USED FOR DEVELOPING BRAND INDIA
Government Initiatives
The Government of India would notify a new limit for reporting about
transactions in gold and other precious metals and stones to authorities, to avoid
the parking of black money in bullion.
The Bureau of Indian Standards (BIS) has revised thestandard on gold hallmarking
in India fromJanuary 2018. Thegold jewellery hallmark will now carry a BIS mark,
purity in carat and fitness as well as the unit’s identification and the jeweler’s
identification mark. The move is aimed at ensuring a quality check on gold
jewellery.
The Government of India has planned to set up a Common Facility Center (CFC) at
Thrissur, Kerala.
The Gems and Jewellery Export Promotion Council (GJEPC) signed a
Memorandumof Understanding (MoU) with Maharashtra IndustrialDevelopment
Corporation (MIDC) to build India’s largest jewellery park in at Ghansoli in Navi-
Mumbai on a 25 acres land with about more than 5000 jewellery units of various
sizes ranging from 500-10,000 square feet. The overall investment of Rs 13,500
crore (US$ 2.09 billion).
A jewellery park worth Rs 50 crore (US$ 7.8 million) is to be set up in Mumbai by
the Government of India where local handmade workers and factories will be
relocated to develop their trade, improve their work environment and standard
of living.
The Government of India launched the Sovereign Gold Bond Scheme. This
scheme enables the Reserve Bank of India (RBI) to issue gold bonds denominated
in grams of gold individuals in consultation with Ministry of Finance.
The Government of India has approved the setting up of four common facility
centers (CFCs) in Ahmedabad, Amreli, Visanagar and Palanpur at a total cost of
INR 16.15 crore (US$ 2.52 million); of which the CFCs at Palanpur and Visanagar
have already been inaugurated

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These CFCs are expected to provide access to a common pool of state-of-the-art
machinery and equipment at a cheaper rate to small and medium diamond
manufacturers; and it will also be used for transfer of technology and r e-skilling
and training of existing artisans. A total of 200 small and medium manufacturers
will receive access to the CFCs.
Mr. Arun Jaitley, Minister of Finance, Government of India, launched the Gold
Monetization Scheme in November 2015. This scheme enables individuals, trusts
and mutual funds to deposit gold with banks and earn interest on the same in
return. The designated banks accept gold deposits under the Short Term (1-3
Years) Bank Deposit as well as Medium (5-7 years) and long (12-15 years) Term
Government Deposit Schemes.
Gold Monetization Scheme
The Gold Monetization Scheme (GMS) in the form of Gold Deposit Scheme (DPS)
and Gold Metal Loan (GML), launched in November 2015, allows individuals,
trusts and mutual funds to deposit gold with banks in return for interest. This is
helping reduce dependence on gold imports and alleviate pressure on trade
balance.
The designated banks accept gold deposits under the Short Term (1-3 Years) Bank
Deposit as well as Medium (5-7 years) and long (12-15 years) Term Government
Deposit Schemes.
The Government also launched the Sovereign Gold Bond Scheme, under which
gold bonds denominated in grams of gold are issued to individuals by the Reserve
Bank of India (RBI) in consultation with Ministry of Finance.
Infrastructure Development
With a view to develop India into an international diamond training hub, a Special
Notified Zone (SNZ) was opened at Bharat Diamond Bourse in Mumbai on
December 20, 2015. The creation of SNZs has ensured the regular availability of
direct supply of rough diamond in the country itself and within easy access, not
only save time and effort of travel by diamond manufacturers, who move to

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different centres to procure rough diamonds, but has also minimized middlemen
commissions and eventually costs.
Fiscal incentives
Customs duty on import of Imitation Jewellery increased from existing level of
10% to 15% with the view to protect local manufacturers (Budget 2016-17).
In order to provide clarity, section 10AA of the Income-tax Act has been
amended to provide a sunset date of March 31, 2020 for commencement of
activity of manufacture or production of any article or thing or providing services
by a unit located in a Special Economic Zone (SEZs) for availing the deduction
underthesection.

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6.IMPACT ON DEVELOPMENT OF COUNTRY
India is one of the largest exporters of Gems and Jewellery. The industry plays a
vital role in the Indian economy for its role as a major contributor to the total
foreign exchange reserves of the country.
India's fascination with jewellery dates to 5,000 years ago in the Indus Valley. At
that time, the country was the largest manufacturer and exporter of beads to the
world. It was also home to diamonds, semi-precious stones and gold. In fact, for
more than 2,000 years, India was the sole supplier of gemstones to the world.
Golconda diamonds, sapphires from Kashmir and pearls from the Gulf of Mannar
were the most desirable and attracted merchants from across the globe to India.
While for the rulers, these precious stones and jewellery were a statement of
power, success and reputation, for Indian women, they were and still are
considered as imperatives for providing social and economic security, the value of
which may never depreciate.
Today, the gems and jewellery industry is one of the biggest businesses in India,
playing a crucial role in the Indian economy. Contributing around 7 per cent of the
country's GDP and 15.71 per cent to India's total merchandise exports, this is one
of the fastest growing sectors that are extremely export-oriented and also labour
intensive. As a result, the industry brings in huge foreign exchange and gives
employment to over 4.64 million workers, both in organized as well as
unorganized sectors. The rising demand for Indian gems and branded jewellery

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fromacross the globe is primarily being driven thanks to the increase in per capita
income of the consumers and a stronger purchasing power of the middle-class
woman.
Despite such escalating demand, there is a lack of skilled workmen in the industry.
Post demonetization, not many trained artisans are willing to join the industry
due to better work opportunities in different fields and absence of successive
governments' intervention in providing proper infrastructure. To stabilize this
situation, the central and state governments must roll out a strategic plan that
can bring back the long lost 'Sone Ki Chidiya' (the golden bird) status of India.
The industry is already seeing an influx of established brands who are helping the
market become more organized. Further, the growth in the gems' and jewellery
sector is likely to be dominated by the increasing penetration of new players.
They are expected to not only unravel the potential to create new jobs but will
also contribute to the economy through voluminous exports.

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7.GLOBAL CONNECT
Indian gems and jewellery industry have achieved a premier position in the global
market. The products of India’s exports of gems and jewellery are acknowledged
all over the world for their exquisite craftsmanship. Modern state of the art
machinery and computerised operations have lent a cutting edge to gems and
jewellery manufacture. Over three million people are directly or indirectly
employed in this industry. The industry is one of the important foundations of the
export growth of India. India captured and increased proportion of this market,
and at present, India is the world’s leading diamond cutting and polishing centre.
In recent times, India has increasingly held a dominant position in the global
market in the cutting and polishing of diamond. It is said that 11 out 12 diamond
sets in jewellery are cut and polished in India. India is accounting for 65 per cent
share of the global polished diamond market in terms of value. Gold jewellery
contributes 30 per cent and coloured gemstones and others contribute 2 per cent
each, whereas rough diamond contributes 3 per cent of total share. The industry
is truly global one, with both suppliers and buyers from many different countries.
Indian gems and jewellery sector is one of the most significant constituent of the
Indian economy. It is responsible for bringing in valuable foreign exchange and
contributes about 6-7% to the Indian GDP.

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In addition to it gems and jewellery industry is a labor intensive industry and it is
responsible for generating lakhs of jobs each year. This is one sector where India
has a strong global name and it is ranked as the largest exporter of gems and
jewellery in the world. In 2016 the sector saw exports of $32 billion and grew at a
healthy 12%. In terms of segments, exports for 2015-16 included: Cut and
polished diamonds: US $20 billion, gold medallions and coins: US$ 5.2 billion and
silver jewellery: US$ 3 billion.
There is a lot of demand for Indian gems and jewellery all over the globe. UAE, US,
Russia, Singapore, Hong Kong, Latin America and China are among the most
important importers. As per estimates, India exports 95% of world’s diamonds
being largest cutting and polishing centre for diamonds in the world. Research
and markets expect the jewellery market in India to grow at a compound annual
growth rate (CAGR) of 15.95% between 2014 and 2019.
The key centres for the trade are in Surat and Mumbai. About 80% of exports for
diamonds happen out of Surat which has over 3,500 diamond processing units.
These two centres are known for its expertise in the diamond processing space.
The KGK group uses some of the finest manufacturing technologies available for
diamond processing. DiaMark™ laser marking, Galaxy™ diamond mapping and
Water jet laser cutting are some of the commonly used techniques for producing
fine quality diamonds.

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8.LEARNINGS
 • Indian gems and jewellery industry is considered to be the global
hub, it is well established and recognised worldwide for its
craftsmanship and variety. The industry is highly labour intensive and
export oriented; it involves not just workmanship but a lot of patience
and dedication to the art of jewellery making.
 • india as a country has an advantage when it comes to absolute
number of workforce, but the industry is facing a crucial shortage of
“skilled” and “qualified” manpower.

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9.CONCLUSION

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10.BIBLIOGRAPHY
https://www.ibef.org/industry/gems-and-jewellery-presentation
http://www.businessworld.in/article/How-Gems-Jewellery-Sector-Plays-A-
Significant-Role-In-The-Indian-Economy/02-06-2018-150508/
https://www.investindia.gov.in/sector/gems-jewellery
http://tari.co.in/wp-content/uploads/2015/11/The-Gems-Jewellery-Industry-For-
website.pdf
https://www.socialsamosa.com/2014/07/jewellery-shift-target-audience/
https://retailjewellerindia.com/daily-news-2/gems-jewellery-council-sets-100-bn-
target-2025/
http://www.makeinindia.com/home
https://www.gjepc.org/

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