India at a Standstill after Trump's Tariffs
April 06, 25
(IDEX Online) - India's diamond polishing industry is at a near-standstill as it contemplates the consequences of the biggest single blow since COVID.
Duty on exports to the US of loose stones - which were zero-rated until last week - increased to 10 per cent on Saturday (5 April) and will rise to 26 per cent on Wednesday (9 April).
Exporters are rushing get their goods to the US before Wednesday's deadline kicks in. Otherwise they may cancel or delay their orders.
Production in Surat, where 80 per cent of the world's diamonds are polished, has all but ground to a halt.
Kirit Bhansali, chairman of the Gems and Jewellery Export Promotion Council (GJEPC), said: "While the tariff's application to competing nations presents both challenges and opportunities, it is likely to significantly impact India's diamond and jewellery sector.
"In the long term, we foresee a reshaping of global supply chains. In the short run, we anticipate challenges in sustaining India's current export volume of $10 billion to the US market."
Many diamond units fear further job losses or permanent closure as the new tariffs add more than a quarter to the price of their goods in the US.
Traders are actively seeking alternative markets - the Middle East, Southeast Asia, and Africa - to reduce their dependence on the US, which accounts for over 30 per cent of India's $33bn gem and jewelry exports.
They're also renegotiating contracts with US buyers to share the burden of increased tariffs or adjust pricing structures.