The spike in exports comes just before a new 26% reciprocal tariff on Indian diamonds enters into effect on April 9, following an announcement made by former US President Donald Trump. The move has prompted a rush among Indian exporters to ship as much inventory as possible before the deadline, in order to avoid the additional duty and maintain competitiveness in the US market.
The United States remains the largest global consumer of diamonds, accounting for nearly one-third of India’s $32 billion gem and jewellery exports annually. With the new tariff in place, the cost advantage that Indian diamonds traditionally hold in the American market is expected to diminish.
The surge in shipments has also raised concerns about supply chain strain. Many rough diamonds currently in the processing pipeline are unlikely to be ready for export before the tariff deadline, which could result in delayed deliveries and potential disruptions in trade flow.
Industry players are also watching the potential fallout in Surat, India’s diamond cutting and polishing hub. Reduced demand from the US market may lead to adjustments in production volumes, possibly affecting employment and operations across the sector.
While some believe the US will continue sourcing diamonds from India due to longstanding business ties and quality craftsmanship, the overall impact of the new tariff is expected to challenge margins, pricing strategies, and the pace of exports in the short term.
With the new trade terms now in effect, India’s diamond industry faces a critical period of adjustment, requiring agility and strategy to navigate an evolving global market landscape
