Targeting a export of gem and jewellery worth $16 billion within the next three years, the Gem and Jewellery Export Promotion Council on Saturday said the industry was recording an average growth of 25 to 30 per cent.

"The Indian gem and jewellery industry has been growing leap and bound and we believe we will achieve our vision of touching exports of $16 billion by 2007," said Bakul Mehta, chairman of Gem and Jewellery Export Promotion Council.

India has established itself as the world's largest manufacturing centre of cut and polished diamonds with exports already reaching $8.6 billion, he said at the council's 31st annual award function in Jaipur.

India, he said, was contributing 60 per cent of the world's supply in terms of value, 85 per cent in terms of caratage and 92 per cent in terms of pieces.

Eleven out of 12 stones set in jewellery worldwide are from India, making the country a preferred source of gem and jewellery, Mehta said.

He, however, warned against any contentment as China and Thailand were posing challenge to India's supremacy in the trade.

Stressing the need for effective implementation of supportive state policies, he said, "we have fine policy framework on paper but it must be implemented on ground level fully and effectively so that India could achieve its full potential."