Diamond Industry Seeks Urgent Government Aid as US Tariffs Slash Exports by 50%

India’s diamond industry is reeling under the impact of increased US tariffs, with exports falling dramatically and widespread job losses forcing the sector to seek urgent government intervention. The crisis has deepened significantly since the start of 2025, when additional trade barriers were imposed on one of the industry’s most crucial markets.

The diamond sector was already contending with weak demand from China at the beginning of 2025, relying on steady US orders for stability. However, the situation deteriorated sharply when US President Trump imposed an additional 25% tariff on Indian goods, including diamonds. This increase brought the total duty burden to 50%, creating a substantial barrier for Indian exporters in the American market.

The tariff burden has forced significant operational adjustments across the diamond processing sector. Several exporters have either closed their operations entirely or shifted focus to lab-grown diamonds, though this alternative offers much thinner profit margins. The transition has been particularly challenging for businesses heavily invested in natural diamond processing infrastructure.

The industry maintains hope for an early Indo-US trade agreement that could help restore access to the American market. However, until such arrangements materialize, immediate government support remains critical for sector survival.