Editor’s Note
The recent reduction in US import tariffs on Indian goods is being hailed by industry leaders as a significant boost for Surat’s diamond export sector. This development arrives at a crucial time, offering potential relief from recent demand challenges and reinforcing the vital trade relationship between the two nations.
Industry leaders said today that the reduction of US import tariffs on Indian goods from 50% to 18% is expected to provide major relief to India’s diamond and jewellery industry, particularly in Surat and Gujarat. The move comes as a boost for the sector, which has been facing sluggish demand and recessionary pressure over the past six months.
The US remains the largest market for India’s gem and jewellery exports, accounting for nearly 30% of total exports, valued at around $10 billion annually. Of this, diamond exports contribute approximately $7–8 billion. However, in 2025, the US imposed an initial tariff of 25%, followed by an additional 25%, taking the total duty to 50%. As a result, Indian diamond and jewellery exports to the US declined sharply by 44.4%, falling from $6.95 billion the previous year to just $3.86 billion between April and December 2025. Exports dropped by over 50% in December 2025 alone.
Expressing happiness over the tariff reduction, Dineshbhai Navadiya, Chairman of the Indian Diamond Institute in Katargam, Surat, said that excessive duties had created job uncertainty for lakhs of workers in Surat’s diamond polishing units. Margins were under pressure and cash flows were disrupted.
He added that Prime Minister Narendra Modi’s trade engagements, including the EU trade deal and the latest US decision, would provide a larger market for the diamond, gem and jewellery sector. American buyers in the mass-market and mid-price segments are expected to turn back towards Indian diamonds and jewellery, restoring demand for natural diamonds despite rising competition from lab-grown alternatives.
Navadiya said the tariff cut would open a new chapter in India-US trade relations, leading to rapid growth in exports in the coming months and reviving the Surat-Mumbai diamond hub.
Surat Diamond Association Treasurer Shantibhai Dhanani said the tariff cut would particularly benefit the low-value CVD (Chemical Vapour Deposition) and HPHT (High Pressure, High Temperature) diamond segments, creating large-scale employment opportunities.
Dhanani noted that around 8–10 lakh artisans are employed in Surat’s diamond factories. He also urged the government to seek similar tariff relief on jewellery exports to accelerate growth further.
Damjibhai Mavani, former secretary of the Surat Diamond Association, welcomed the move, calling it a “booster dose” for the diamond industry following discussions between Prime Minister Narendra Modi and US President Donald Trump.
He said the Indian diamond trade depends heavily on the US, Europe and the Far East. With Chinese consumers shifting towards gold in recent years, Western markets have become even more critical. High tariffs had created recessionary conditions, but the direct cut to 18% now signals the possibility of a strong revival.
Mavani added that Indian diamonds will now be sold at more competitive prices in the US, helping Surat regain its position on the global stage.
Surat Diamond Association Secretary Dhirubhai Savani said the tariff cut would increase investment, exports and employment, strengthening the national economy.