Gems and jewellery exports declined by 19% year-on-year to $3.1 billion in August 2012 on account of strong decrease in diamond exports, said Gems and Jewellery Export Promotion Council (GJEPC) Executive Director, the Sabyasachi Roy.

"Gems and jewellery exports have come down because our diamond exports have decreased tremendously due to the 2 percent import duty imposed by the government on cut & polished diamond, which is also affecting the trading exports," Roy told SME Times.

He added that the impact will last till February 2013 on month-to-month basis. However, the diamond trend is not that bad at the moment. But the slowdown in the cut and polished diamond exports have actually impacted the overall gems and jewellry exports.

In August 2012, the exports of cut and polished diamonds declined by 41% followed by gold medallions and coins exports, which dropped by 23%, and coloured gemstones 12%, respectively. Last year, the total gems and jewellery exports stood at $3.8 billion.

On the weak demand in the western markets, he said, the demand in the Europe is still very slow and same is with the US. The major markets for the country's jewellery exports include Europe, the US, the UAE and Hong Kong.

During April-August this year, the country's overall gems and jewellery exports dropped about 11% to $16.1 billion compared to $18.2 billion in the same period last year. These exports remained flat at about $43 billion in 2011-12 compared to the previous fiscal.