First the Russia-Ukraine war and now the American tariffs… the diamond industry of Surat, Gujarat has suffered a second major blow within three and a half years. Surat is also called the ‘Diamond City’ of the world. There is a reason for this also. Because Surat is the biggest center of diamond cutting and polishing. America is the biggest buyer of Surat’s ‘diamond’. Now the increase in tariff may affect the export of diamonds from Surat.
US President Donald Trump has imposed 50% additional tariff on Indian imports. Earlier, 2.1% tariff was imposed on diamonds and gems exported from India. Now 52.1% tariff will be imposed. Due to increase in tariff, diamonds coming from Surat, India will become very expensive in America.
The shine of diamonds is fading in Surat!
Surat’s diamond industry was already going through a crisis due to the war between Russia and Ukraine. Now Trump’s extra 50% tariff has deepened this crisis.
Most of the diamonds are produced from Alrosa in Russia. 30% of the world’s rough diamonds come from Alrosa. Before February 2022, India alone bought 60% of the rough diamonds supplied by Russia to the world. This rough diamond was polished in India and then exported.
America had imposed sanctions on Russia after the Ukraine war. This affected the supply of rough diamonds. Due to this, thousands of people have already lost their jobs.
Reports suggest that due to the recession in diamonds, many factories in Surat have already been closed. Due to this, jobs have also ended. People come from villages and villages to work in these diamond factories of Surat. Their job is to cut diamonds.
Gujarat’s Diamond Workers Union had reported in October last year that more than 60 workers had committed suicide in the last six months. These were the workers who had lost their jobs.
Not only this, in December 2023, Prime Minister Narendra Modi inaugurated ‘Surat Diamond Bourse’ in Surat. This is the largest trade center in the world. There is space for more than 4,700 offices here. It is spread over 67 lakh square feet. It is bigger than the Pentagon, the US Defense Ministry. According to news agency Reuters, only 250 offices are currently open in this 15-storey building.
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How big is Surat’s diamond industry?
Surat is the biggest center of diamond cutting. Four out of every five diamonds in the world are cut and polished in Surat. The people here have been doing the work of carving and polishing diamonds for generations. Apart from this, they do not know any other work.
90 percent of the world’s rough diamonds are sent to Surat for cutting and polishing. More than 8 lakh people work in the diamond industry of Surat. Whereas, 13 lakh people are involved in this work across the country.
However, very few of the diamonds polished in Surat are used by Indians, as most of them are exported.
For the last few years, the export of diamonds from India has been continuously decreasing. According to the Gem and Jewelery Export Promotion Council (GJEPC), diamonds worth $13.3 billion were exported from India in 2024-25. This was about 17 percent less than in 2023-24. Diamonds worth about $16 billion were exported in 2023-24.
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What could happen from Trump’s tariffs?
Now US President Trump has imposed 50% tariff. This has put millions of jobs at risk. GJEPC President Shaunak Parikh says that if India and America do not reach a deal to reduce tariffs, 1.5 to 2 lakh artisans may lose their jobs.
People associated with the industry believe that American buyers will start buying diamonds from countries like Israel, Belgium and Botswana instead of India.
Former regional chairman of GJEPC Dinesh Navadiya told news agency PTI that Trump’s tariffs will make Indian diamonds costlier in America. He said that India had exported diamonds worth $13.3 billion in 2024-25. Of this, diamonds worth $4.8 billion were exported to America alone. This means that 40% of India’s diamonds are exported to America only.
However, Surat Diamond Association (SDA) President Jagdish Khunt believes that the impact of the tariff will be only for some time, because America has no alternative for polished diamonds. He said that 9 out of 10 diamonds are cut and polished in India, so the impact of Trump’s tariffs will last only for some time. He also said that just as Indians love gold, Americans are obsessed with diamonds. No matter how expensive diamonds become, Americans will not stop buying them.
Dinesh Navadiya says that the Free Trade Agreement (FTA) with UAE, UK and Australia can be taken advantage of to reduce the impact of tariffs. He said that it would be a matter of great relief if Russia and China also open their markets for us.
Overall, Trump’s tariffs have increased the concerns of diamond traders and artisans of Surat. Many factories may close and lakhs of artisans may lose their jobs.
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