G7 nations sanctions against ALROSA fall flat due to a lack of tracing technology

The G7 nations sanctioned the Russian diamond industry in January 2024, with plans to introduce a tracing platform in September. The tracing aspect of the sanctions was delayed for the first time to March 2025 and then again to January 2026. Attempts to sanction the Russian diamond industry in response to the conflict in Ukraine have been described as ineffective by an executive of ALROSA.

ALROSA’s head of international cooperation mocked the US and EU during a recent address, suggesting they had little understanding of the trade. Pyotr Karakchiyev, Head of International Relations Department at ALROSA, said, “Tracing is one of the key conditions that the G7 wanted to bring in to stop Russian gemstones from entering Western markets. There is no technical solution. The sanctions that our adversaries dreamed up were supposed to affect us in a big way, but they are not achieving the necessary effect, at least for them.”

Since 2022, there was a general ban on directly importing diamonds from Russia to the US. In May 2024, Reuters reported that the US had ‘disconnected’ from G7 working groups formulating sanctions against the Russian diamond trade due to industry backlash. Russia continues to export large volumes of diamonds to countries outside the G-7, which allows them to still enter the polished diamond markets.