India's Glittering Industry Faces Dark Times: Over 1.7 Lakh Jewellery Jobs Hang by a Thread

India's glittering gems and jewellery sector, a cornerstone of its economy and a beacon of its skilled craftsmanship, is currently facing its darkest hour. A staggering 1.73 lakh workers, the very hands that craft the nation's precious adornments, find their livelihoods hanging precariously in the balance.

This dire situation is not confined to one city but casts a long shadow over major manufacturing hubs stretching from the bustling streets of Mumbai and the diamond capital of Surat, to the vibrant artistry of Jaipur, the cultural heart of Kolkata, and the gold hub of Thrissur.

The human element of this crisis is profound.

The vast majority of these workers, many of whom are skilled artisans with generations of expertise, hail from economically vulnerable regions like Uttar Pradesh, Bihar, and West Bengal. Their potential unemployment threatens to send ripples of hardship through countless families, exacerbating existing economic challenges.

What has brought this once-thriving industry to its knees? A confluence of adverse global economic factors.

A significant global slowdown, exacerbated by persistent inflationary pressures in key international markets such as the United States, Europe, and China, has severely dampened consumer demand for luxury goods. The result? A wave of order cancellations from these crucial export destinations, leaving Indian manufacturers with unsold inventory and dwindling new business.

The numbers paint a stark picture.

According to data from the Gems and Jewellery Export Promotion Council (GJEPC), overall exports from the sector plunged by a worrying 11.23% to $25.79 billion in the April-November period of FY24. More specifically, cut and polished diamond exports, a major segment, saw an even steeper decline of 27.56% to $19.04 billion during the same period.

This sharp contraction highlights the severity of the market downturn.

The ripple effect of this crisis is felt across the entire intricate supply chain. From the initial stages of rough diamond cutting and polishing in Surat to the intricate setting of precious stones in Mumbai and Jaipur, every segment is grappling with reduced orders and financial strain.

Businesses are being forced to adopt drastic measures to stay afloat. Many units have already implemented reduced workdays, cutting their operations to just three or four days a week, a clear sign of diminishing demand. Layoffs, once unthinkable, are now becoming an unfortunate reality for a significant number of workers.

Adding to the complexity is the paradox of fluctuating material costs.

While the prices of rough diamonds have seen an upward trend, the prices of finished, polished diamonds have unfortunately moved in the opposite direction, declining steadily. This imbalance squeezes profit margins, making it even harder for manufacturers to sustain operations and retain their workforce.

As the industry grapples with this uncertainty, all eyes are now on the upcoming Union Budget.

There's a collective hope within the sector that the government will introduce supportive policies and initiatives to help mitigate the crisis. Targeted financial assistance, export incentives, or measures to stimulate domestic demand could provide a much-needed lifeline to an industry that is not only a major foreign exchange earner but also a significant employer of skilled labor, contributing immensely to India's artisanal heritage.

The fate of 1.73 lakh dedicated workers and the future of India's illustrious gems and jewellery trade now hang in a delicate balance, awaiting a glimmer of hope amidst the economic shadows.