New Delhi, August 3, 2025 : India’s polished diamond exports to the US are facing fresh hurdles following new tariffs and penalties imposed by Washington, according to officials at Crisil Ratings.
The US, which accounted for 35% of India’s natural polished diamond exports in FY25, has seen its share plummet to 24% in Q1 FY26 following the 10% tariff announced in April 2025. Demand had already been weakening, further compounding the sector’s troubles.
“Due to the tariff shock and subdued retail offtake, revenues of Indian diamond polishers could fall by 20–25% this fiscal, dropping to USD 10–11 billion,” said Rahul Guha, Senior Director, Crisil Ratings.
Operating on slim margins of just 4–5%, Indian polishers have little room to absorb cost increases. “Miners and retailers may have to share the burden to limit price escalation,” added Himank Sharma, Director, Crisil Ratings.
In FY25, India’s natural diamond exports had already declined 17% to USD 13.3 billion, due to muted demand from China and competition from lab-grown diamonds (LGDs) in the US. While exporters rushed to clear inventories before tariffs kicked in, the long-term impact is expected to weigh further on the industry.
India remains the world’s largest exporter of diamonds and the leading consumer of gold.
The Gems and Jewellery sector has voiced serious concerns over the 25% retaliatory tariff imposed by the US on Indian goods, announced by President Donald Trump on July 30. Trump also warned of additional penalties linked to India’s oil trade with Russia.
Industry stakeholders fear short-term disruptions, job losses, and higher prices for American consumers, but also point to India’s growing global partnerships — notably FTAs with the UK, Australia, and UAE — as strategic buffers that could soften the blow.
“While short-term pain is inevitable, long-term outcomes may impact US buyers more than Indian exporters,” said an industry representative.
