Indian diamond exporters, hit by a 50% US tariff that slashed cut and polished diamond (CPD) exports to America by two-thirds, are turning to China as a potential buffer. With China's economic recovery and improving India-China ties, the Asian market may help stabilize the supply chain for overseas jewelry buyers seeking alternative sourcing routes.
Tariff impact on US exports
India's CPD exports to the US plummeted from $13.58 billion in 2022-23 to $4.9 billion in 2024-25, a drop of nearly two-thirds. The 50% tariff, combined with falling natural diamond prices and competition from cheaper lab-grown diamonds, has sharply reduced demand in the American market. Economic slowdown due to global conflicts further dampened US consumption.
China emerges as alternative market
Before the Covid-19 pandemic, China had already surpassed the US as the top importer of Indian CPD. In 2017-18 and 2018-19, India exported $10.04 billion and $9.39 billion worth of CPD to Hong Kong, compared to $7.67 billion and $8.31 billion to the US. In 2024-25, China imported $3.2 billion worth of CPD, narrowing the gap with the US's $4.9 billion.
Industry confidence and adaptation
"Traders have noticed buying in China as its economic situation improves. In the current scenario, other markets can play a role in supporting the CPD industry," said Dinesh Navadiya, chairman of the Indian Diamond Institute. Jagdish Khunt, president of the Surat Diamond Association, added: "There is no other country that has the skill, technology and infrastructure that Surat and India have. For a time, there will be an impact, but once the market absorbs the shock, there will be demand for diamonds again."
What buyers should watch
The Gem and Jewellery Export Promotion Council (GJEPC) is actively organizing seminars to educate manufacturers on export opportunities in new markets. "We are working on opening up new markets and staying on the growth track," said Jayanti Savaliya, regional chairman of GJEPC. Overseas buyers should monitor China's import trends and India's trade diversification efforts, which could reshape diamond pricing and availability in the coming months.
Source: Read the original report | Published: September 03, 2025