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15-04-2025
Bureau Report + Agencies
NEW DELHI/ MUMBAI: India’s exports of cut and polished diamonds plummeted to their lowest level in nearly two decades in the 2024/25 fiscal year, which ended in March, on sluggish demand from the United States and China, a leading trade body said on Monday.
India is the world’s largest cutting and polishing hub, handling nine out of every 10 diamonds processed globally but it is sensitive to economic uncertainty particularly in the US, its biggest market.
Cut and polished diamond exports, which usually account for nearly half of overall gem and jewelry shipments, fell 16.8% to $13.3 billion year-on-year, the Gems and Jewelry Export Promotion Council (GJEPC) said in a statement.
The slump dragged down overall gem and jewelry exports by 11.7% to $28.5 billion, a four-year low from $32.28 billion the previous year.
The lower demand for polished diamonds also prompted Indian processors to reduce imports of rough diamonds by 24.3% to $10.8 billion, the trade body said.
Gems and jewelry exports rose by 1% year-on-year in March, however, to $2.56 billion, the GJEPC said, as exporters ramped up shipments ahead of announced US tariffs.
US President Donald Trump initially planned to place a 27% tariff on imported Indian goods from April 9 as part of duties targeting dozens of countries but then declared a 90-day pause on the measure.
“US buyers were loading up in March before the tariffs kicked in. Indian exporters were also rushing to ship out US orders first, so they wouldn’t get hit with those extra costs,” said Shaunak Parikh, vice-chairman of GJEPC.
India’s gems and jewelry exports are unlikely to recover this year, one major Mumbai-based exporter told media, as the US tariffs have roiled global markets and shaken buyer confidence.
Meanwhile, a wave of anxiety has gripped India’s diamond polishing hub of Surat, as hefty US tariffs threaten to undermine the country’s gem and jewelry exports, putting at risk the livelihoods of thousands of workers.
The United States, which takes more than 30% of the South Asian nation’s gem and jewelry exports, set a 27% reciprocal tariff on it on Thursday, at a time when demand is softening in other key markets such as China, the Middle East, and Europe.
“Tariffs will hit hard the demand for diamonds in the United States and job losses look inevitable, at least in the short term,” said Dinesh Navadiya, chairman of the Surat-based Indian Diamond Institute.
Surat, the second-largest city in Gujarat, the western home state of Prime Minister Narendra Modi, processes and polishes more than 80% of the world’s rough diamonds, and India accounts for nine in every 10 diamonds processed globally.
Business has ground to a halt in its teeming diamond market, where more than 10,000 traders and brokers gather each day, as the industry tries to figure out how matters will evolve in the coming months.
Conditions are worse than during the 2008 financial crisis, when the industry was plagued by fears of a prolonged recession, said Mansukh Mangukiya, a diamond trader for five decades.
A slowdown in the industry will hit all manufacturers, but smaller players will suffer most, said Sevanti Shah, chairman of Venus Jewels, adding, “many smaller manufacturers will have no choice but to shut down.”
The United States accounted for nearly $10 billion, or 30.4%, of India’s annual gems and jewelry exports, totaling $32 billion in the fiscal year 2023/24.
