India’s Polished Diamond Exports Hit 20-Year Low as Global Demand Dims

India’s polished diamond exports have declined to their lowest level in nearly two decades, reflecting persistent global economic pressures and subdued consumer demand in key international markets. According to the Gems and Jewellery Export Promotion Council (GJEPC), exports of cut and polished diamonds fell by 16.8% year-on-year in FY 2023-24 to $13.3 billion. This is the lowest figure recorded since the early 2000s, highlighting the extent of the slowdown facing one of India’s major export sectors.

The downturn has been largely attributed to reduced demand in the United States and China, which are among the largest consumers of polished diamonds. Economic uncertainty, shifting consumer preferences, and cautious discretionary spending patterns in these markets have contributed to lower order volumes. The U.S. market, traditionally the largest buyer, has seen weaker retail activity, while Chinese buyers have shown reluctance due to concerns about resale value and broader economic conditions.

India, which processes around 90% of the world's rough diamonds, also witnessed a sharp drop in rough diamond imports, falling 24.3% to $10.8 billion during the same period. This decline reflects industry efforts to manage supply in response to sluggish demand and maintain pricing stability across the value chain.

The broader gems and jewellery sector also faced a challenging year, with overall exports declining 11.7% to $28.5 billion. This marked the lowest export value for the sector in four years. However, a marginal uptick was observed in March 2024, when exports rose by 1% to $2.56 billion. This temporary rise was linked to exporters accelerating shipments ahead of a proposed 27% tariff on Indian jewellery by the U.S., which was later deferred for 90 days. The export slump has had a noticeable impact on diamond polishing hubs such as Surat, where many small and mid-sized units have scaled back operations. Reports indicate job losses and reduced working hours for thousands of workers, underscoring the socioeconomic implications of the industry’s current slowdown.

In response, industry stakeholders are seeking policy support, including tariff relief from the U.S. government, to ease market access challenges. The GJEPC has also initiated discussions with major diamond miners to step up marketing efforts in key consumer markets in order to stimulate demand. While near-term recovery remains uncertain, the industry is closely monitoring global economic trends and trade developments, with a view to stabilizing exports and supporting long-term growth.