In the majority of Neolithic India, as in most parts of the world at that time, people fashioned jewelry out of seeds, feathers, berries, flowers, bones and shells. But in the north of India, in the Indus valley cities of Mohenjo–daro and Harappan, men and women were already wearing jewelry made of gold, silver, copper and set with precious and semi–precious gemstones.

The Indus valley civilization, preceding the Vedic, existed from 3000 B.C. to 1500 B.C., and was built in and amongst the fertile lands of what is known today as Pakistan. The Neolithic Indus valley people like others, domesticated animals and harvested crops of cotton, sesame and barley. Contrary to the belief that India only possessed an agricultural economy in this period, evidence has been found at the Indus cities of Mohenjo–daro and Harappan, showing the people as having been sophisticated urbanites whose cities were bastions to art and culture.

The brick cities, acting as focal points for a kind of centralized state, towered high above the Indus plains and were established along important trade routes that connected the 'Far East' with the 'Near East'. They were visible for large distances, a landmark to the prosperity of their rulers, inhabited by generations of merchant classes, skilled artisans, farmers and sea–faring adventurers engaged in extensive trading.

Proof of the Indus people's impact on Neolithic trade was found when archaeologists excavating Mohenjo–daro and Harappan found engraved seals written in cuneiform, the world's first written language whose origins lay in Mesopotamia in the Near East. The seals, describing the contents of sacks, were used to close bundles of merchandise as cord marks on the reverse side testify. Other similar seals were found in ports on the Persian Gulf near modern Bahrain, and amongst Mesopotamian sites at the city of Ur.

The seals originating from the Indus sites described cargos of textiles, and luxury goods such as semi precious gemstones, ivory, carnelian beads, pearls, mother of pearl and jade sent to Persia and Mesopotamia in exchange for gold, silver, tin, copper, lapis lazuli and turquoise. Bitumen from Mesopotamia, where it occured naturally, was also imported and used as the binding glue in mother of pearl inlay in precious items of jewelry and ornamentation. These products and their seals found in various Indus archeological sites bare testament to the presence of foreign traders living amongst the Indus people.

The Indus civilizations were ethnically diverse incorporating many cultures and creeds. Many terracotta, bronze and stone figurines found at the Indus sites display a variety of different styles of clothing, headdresses and ornamentation indicating a multi–ethnic civilization. Some of the figurines were adorned with multiple chokers and necklaces, which appear to represent beaded ornaments of gold, silver, and semi–precious gems. The complex 'Cire Perdue' casting technique, meaning 'Lost–wax,' was employed in the production of the metallic figures pointing towards a culture of knowledgeable and sophisticated metallurgists.

Further excavations of Mohenjo–daro's lower levels revealed the living quarters of metal workers, specializing in the production of copper and bronze implements and weapons. Flat axes, spears, knives, arrowheads, chisels, saws and razors were caste in smelting furnaces then simply hammered into shape. Silver, reserved for smaller precious objects, was smelted and molded into small vases, vessels, seals, pendants, and brooches. Other crafts in the city included the manufacturing of beads made in a variety of different shells, ivory and semi precious gem types such as alabaster, lapis lazuli and turquoise from Persia, amethyst from Maharashtra, and jade from Central Asia.

By 2000 B.C. the Indus valley civilizations were disappearing due to internal decline. The eventual demise of the Indus Valley Civilization came about in 1500 B.C., with Aryan invaders from the north firstly destroying the outlying villages, and then overrunning the cities of Harappan and Mohenjo–daro. The Indus civilization with their highly advanced knowledge of process metallurgy, gem cutting and jewelry production were eventually pushed further south into India where they created a legacy of fine arts for which India today is known the world over. By the third century B.C., after the reign of Buddhist emperor Ashoka, India was mining its own extensive gemstone resources, and had become the world's leading exporter of precious and semi–precious gemstones.

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