Shares of Indian jewellery retailers fell sharply on Monday after Prime Minister Narendra Modi urged citizens to cut back on gold purchases to alleviate pressure on the country's foreign exchange reserves. Kalyan Jewellers India saw a 9.27% decline, Senco Gold dropped 8.18%, and Titan Company fell 6.73%, underperforming the benchmark Nifty50 index, which closed 1.49% lower. Modi's comments raised concerns about reduced demand, tighter financing conditions, and potential increases in import duties for the sector. The gems and jewellery industry is crucial, employing over 5 million people directly and indirectly, with organized retailers holding a 37-42% market share. India faces a current account deficit due to high imports, with gold imports estimated at nearly $72 billion annually. Retailers are adapting by promoting gold exchange programmes, where consumers trade old jewellery for new, helping to mitigate import increases. However, analysts caution that reducing dependence on physical gold will be challenging, especially in rural areas where gold serves as a safety net.