Ahmedabad: Indian gem and jewellery exporters will continue to face an additional 10% US tariff after US brought a new Section 301 tariff regime into force on July 24. Industry leaders said the move would hurt exports despite giving India an edge over several competing manufacturing hubs.Calling the levy “unjustified”, Gem & Jewellery Export Promotion Council (GJEPC) chairman Kirit Bhansali said, “The 10% US tariff under the new Section 301 regime remains a challenge for India’s gem and jewellery exports. While India’s placement in the lower tariff band offers some relative competitiveness in jewellery, bridging the remaining tariff gap through an early India-US bilateral trade agreement and securing tariff relief for natural diamonds and coloured gemstones remain our key priorities.”The new regime replaces the temporary Section 122 balance-of-payments surcharge. It follows investigations by the Office of the United States Trade Representative (USTR) into the implementation and enforcement of prohibitions on imports produced with forced labour across 60 economies.GJEPC said, “India had been placed in the lower 10% tariff band after adopting a prohibition on imports produced with forced labour. Competing manufacturing and trading hubs, including China, Hong Kong, Thailand, Turkiye, the UAE, Israel and Vietnam, now face an additional tariff of 12.5%, giving Indian exporters a 2.5-percentage-point tariff advantage in the US market.”Bhansali said India’s gem and jewellery industry had long followed responsible sourcing and ethical business practices.Despite the relative advantage over some competitors, the council said Indian exporters continued to face a significant disadvantage against Belgium, a global diamond trading hub that continues to enjoy a zero additional tariff on natural diamonds.GJEPC said jewellery exports to the US will continue to attract the existing Most-Favoured-Nation (MFN) duty of 5.5% to 6%, along with the additional 10% tariff, taking the effective import duty to about 15.5% to 16%. Lab-grown diamonds and synthetic stones will also remain subject to the additional 10% tariff.
