Congress accuses Modi govt of pushing jewellery sector into crisis

The Congress party on Friday mounted a sharp attack on the government of Prime Minister Narendra Modi for its appeal to curb gold purchases and the recent hike in import duty on gold and silver, alleging that the measures would devastate India’s jewellery industry and jeopardise the livelihoods of nearly 3.5 crore people dependent on the sector.

Addressing a press conference in here, Congress MP and General Secretary Randeep Singh Surjewala accused the Prime Minister of contradicting his own political rhetoric and pursuing policies that would severely hurt small jewellers, artisans and workers across the country.

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“On April 22, 2024, in Banswara, Rajasthan, Mr Narendra Modi told the women of the country that if the Opposition came to power, ‘they will snatch away your mangalsutra’. Exactly two years later, on May 10, 2026, in Hyderabad, Telangana, the Prime Minister himself advised women not to buy gold jewellery for one year,” Surjewala said. “Now the real plan behind snatching away the ornaments of women and mothers has become clear.”

Calling gold jewellery an inseparable part of India’s cultural and religious traditions, the Congress leader said it also served as an economic safeguard for millions of households, particularly women. He argued that the jewellery trade, dominated by small traders and the MSME sector, remained one of the country’s largest employment generators.

“More than 90 per cent of the jewellery business is in the hands of small jewellers, goldsmiths and MSMEs, and around 3.5 crore people depend on this ecosystem for their livelihood,” he said, describing the government’s appeal against gold purchases as a “decree of devastation” for workers, artisans and traders traditionally associated with the profession.

Surjewala also criticized the Centre’s decision to raise import duty on gold and silver from 6 per cent to 15 per cent earlier this week, alleging that the steep increase would encourage smuggling while hurting legitimate businesses.

“On one hand, the government is discouraging people from buying gold jewellery and destroying the livelihood of crores of people, while on the other it has created huge opportunities for smugglers and mafia networks through the steep increase in import duty,” he said.

Citing industry estimates, the Congress leader said the gems and jewellery sector contributed more than 7 per cent to India’s GDP and nearly 12 per cent of exports, with over 85 per cent of exporters belonging to the MSME category. He warned that any prolonged decline in jewellery demand could wipe out lakhs of small businesses involved in goldsmithing, polishing and ornament manufacturing.

The Congress also linked the issue to broader concerns about the condition of small enterprises under the Modi government. Referring to official data, Surjewala claimed that more than 75,000 registered MSMEs had shut down between July 2020 and August 2025, while over 35,000 MSMEs had closed during 2024-25 alone till February 2025.

“In such a situation, paralysing the gold jewellery business and strangling the livelihood of crores of people is not only deepening unemployment and economic distress, but is also a cruel and inhuman act,” he said.

The party further alleged that the higher import duty would fuel illegal trade in gold. Surjewala said government agencies had seized more than 2.6 metric tonnes of smuggled gold in over 3,000 cases during 2024-25, while industry experts believed the actual scale of smuggling was much larger.

“The jewellery sector was already weakened by demonetization, excise duty measures, faulty GST implementation and hurried hallmarking rules. This undeclared one-year lockdown on jewellery purchases and encouragement to smuggling is nothing short of a death warrant for the industry,” he said.

Questioning the Centre’s broader economic strategy, the Congress leader asked why the government had not focused on mobilizing idle domestic gold reserves or creating a bullion banking framework instead of suppressing demand. He also claimed that while the Prime Minister was advising citizens against buying gold, the government and the Reserve Bank of India had themselves significantly increased sovereign gold holdings over the past several months.

Surjewala demanded that the government immediately announce a special economic relief package for workers and businesses linked to the jewellery sector and reconsider the increase in import duty. He also called for policies promoting domestic gold recycling and value-added consumption instead of measures that could “cripple” the industry.

“The Indian National Congress stands firmly with millions of jewellers, artisans and workers whose livelihoods are under threat. We will oppose this injustice from Parliament to the streets,” he said.