The recent interim trade agreement between the United States and India has ignited a rally in Indian jewellery stocks, reflecting the market's optimism about improved export prospects. The framework, announced on February 6, 2026, addresses long-standing tariff concerns and opens doors for enhanced trade between the two nations.
The agreement entails the United States reducing its tariffs on Indian goods from 25% to 18%. Specifically for the gems and jewellery sector, reciprocal tariffs have been set at 18%, with the agreement also paving the way for the elimination of tariffs on a wider range of products over time. Notably, tariffs on cut and polished diamonds could be reduced to zero. According to industry experts, this clarity is as crucial as the numbers themselves, reducing uncertainty for exporters who had experienced a slowdown in orders due to earlier trade frictions.
Several jewellery companies experienced significant gains on Monday, February 9, 2026. Goldiam International led the surge, with shares soaring over 17%. Kalyan Jewellers India jumped more than 16%, supported by its strong Q3 results. Rajesh Exports hit the upper circuit with a 5% gain, while Tribhovandas Bhimji Zaveri shares rallied 7%. Titan Company climbed 3%, nearing record highs, and Senco Gold gained over 8%. Thangamayil Jewellery also saw a rise of more than 9%.
The US is a major market for Indian jewellery, particularly for cut and polished diamonds and gold-studded products. The tariff reductions and potential elimination are expected to boost exports significantly. Dinesh Lakhani, Director of Kiran Gems Private Limited, stated that the tariff reduction to zero for the gems and jewellery sector would open up a very large market for Indian products, allowing chain stores and independent jewellers in the US to source more from India. Rajiv Jain, Chairman of Sambhav Gems Ltd, also welcomed the agreement, noting that the US remains the largest market for India's gems and jewellery exports and that the move has brought much-needed relief to exporters.
The India-US trade deal is expected to benefit both economies. India's exports to the US already stood at $86.35 billion in 2024, and the deal is poised to accelerate growth across various sectors, including textiles, leather, gems and jewellery, pharmaceuticals, home décor, machinery, and technology. The agreement also includes zero-duty access for key agricultural exports, benefiting staples such as spices, tea, coffee, fruits, nuts, and processed foods.
Goldman Sachs Research estimates that the new tariffs could provide an incremental growth boost of 0.2 percentage points of GDP, with India's goods exports exposure to US final demand being approximately 4% of GDP. The trade deal is also expected to lower trade-related uncertainty and unlock a private investment cycle.
While the agreement has been largely welcomed, some concerns remain. Opposition leaders have criticized the deal, and there are concerns about the potential impact on Indian farmers and domestic manufacturing. However, government officials have clarified that a projected $500 billion in purchases from the US is an intention, not a binding commitment, and that India's strategic autonomy in energy sourcing and protection for its agriculture sector remain intact.
Overall, the India-US trade deal is viewed as a positive step for the gems and jewellery sector, with the potential to boost exports, increase competitiveness, and strengthen economic ties between the two countries. The market's positive reaction, reflected in the rally of jewellery stocks, underscores the optimism surrounding the agreement and its potential to revitalize the sector.