Diamond trade feels tariff pinch: Indian exports might face 20–25% slump; margin hit may spread to miners, retailers, says Crisil analysis
The US market, which accounts for 35 per cent of Indian natural polished diamond exports in fiscal 2025, is expected to face additional challenges following recent US tariffs and penalties, according to Crisil Ratings.
A slowdown in natural diamond demand has already been observed in the US market, officials noted.
"Added to this, reduced offtake by retailers post announcement of 10 per cent tariff on Indian exports in April 2025, brought down the share of the US in polished diamond exports to 24 per cent in the first quarter of this fiscal from 37 per cent for the same period last fiscal," said Rahul Guha, Senior Director at Crisil Ratings, quoted by ANI.
"In the milieu, the revenue of Indian diamond polishers can decrease a further 20-25 per cent this fiscal to USD 10-11 billion," Guha added.
Meanwhile, Himank Sharma, Director, Crisil Ratings, said, "Natural diamond polishers, traditionally operating at thin margins of 4-5 per cent, will have limited ability to absorb the tariff-induced price rise. As a result, miners and retailers may need to step in to absorb some of the price shocks."
by Taboola
by Taboola
Sponsored Links
Sponsored Links
Promoted Links
Promoted Links
You May Like
Learn More - How Affiliate Marketing Can Boost Your Income
TheDaddest
Undo
During fiscal 2025, natural diamond export volumes remained restricted due to decreased Chinese demand and US competition from LGD. Despite fourth-quarter sales efforts to avoid tariffs and limited price reductions, natural diamond export revenues declined by 17 per cent to USD 13.3 billion.
As the world's leading diamond exporter and primary gold consumer, India holds significant influence in the global market.
The US announcement on July 30 by Trump of a 25 per cent tariff on India, along with additional penalties for Russian oil purchases, has caused significant worry amongst Indian Gems and Jewellery sector stakeholders, who anticipate immediate market disruptions, workforce reductions and increased costs for US consumers.
Nevertheless, industry leaders remain optimistic, citing India's diversified trade relationships through recent FTAs with the UK, Australia, and the UAE as protective measures, suggesting the US might experience greater long-term consequences than India.
Stay informed with the latest
business
news, updates on
bank holidays
and
public holidays
.
Discover stories of India's leading eco-innovators at Ecopreneur Honours 2025
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Economic Times
34 minutes ago
- Economic Times
India needs concentrated tooling hubs for advanced manufacturing for aerospace and space domain: S Somanath
Synopsis S Somanath called for the establishment of dedicated manufacturing hubs across India, stressing the critical absence of a comprehensive aerospace manufacturing framework. He underscored the pressing demand for skilled technicians in tooling and related sectors, while also highlighting the supply chain challenges that impede India's rocket production capabilities. ANI S Somanath Former Indian Space Research Organisation (ISRO) chairman S Somanath on Tuesday said there is an urgent need to develop tooling hubs in India to truly scale advanced manufacturing. He emphasised that India must create focused, concerted manufacturing ecosystems similar to those in China. Speaking at the Accel Advanced Manufacturing Summit in Bengaluru, Somanath said India lacks an ecosystem for aerospace manufacturing. 'Distributed hubs across the country are not a good idea for sectors like aerospace. We need concentrated hubs where all players are aggregated, coupled with institutions that add value to research and innovation,' he said. He highlighted that specialised skills such as tooling are often not addressed in the domain. 'We need people with great knowledge in tooling processes, metallurgy, materials manufacturing, machine tools, process engineering, and automation,' he said, while discussing India's next decade building frontier tech also pointed out that while Indian rockets are witnessing strong global demand, the lack of sufficient supply remains a bottleneck that needs immediate attention. 'Manufacturing becomes the crux of the problem. The ability to manufacture and launch in a short period is essential,' he told startups looking to build in the space sector, highlighting that mass manufacturing in satellites and small launch vehicles will be needed to capture the global startups and deeptech investors also echoed his thoughts and said that for India, space as a defence technology has come much later, and there are areas where it still needs to play catch-up. Agnikul Cosmos CEO Srinath Ravichandran said the way to address the gap is not to mimic the SpaceX model but to build from scratch. 'Everyone wants to go build a SpaceX, but that may not be the easiest way to build rockets,' he said, adding that instead of replicating the model, solutions can be built from the Indian context for the Rajaram, managing partner at deeptech venture capital firm Speciale Invest, which has backed several spacetech startups, believes, 'There are certain places we (India) can leapfrog, like in-orbit servicing or any action that you can do in orbit. That's very much a level playing field. Maybe the West is just two or three years ahead of us, and India can compete there.'
Economic Times
34 minutes ago
- Economic Times
Accel-backed Bluestone Jewellery cuts India IPO size
India's Bluestone Jewellery and Lifestyle has trimmed the size of its initial public offering, a prospectus showed on Tuesday. ADVERTISEMENT The Accel India-backed company will now issue fresh shares worth 8.2 billion rupees (about $93 million), down from 10 billion rupees earlier. Its existing shareholders, including venture capital firms Accel India and Kalaari Capital, will now sell 13.9 million shares in the offering, lower than the 24 million shares proposed earlier. Bluestone will launch the IPO on August 11 and close bids on August 13. Anchor investors will bid for the share sale on August 8. The jeweller was seeking a valuation of at least 120 billion rupees ($1.37 billion) in the IPO, Reuters reported in December, citing sources. The overall IPO size was slated to be around 30 billion rupees, the sources had said. The company may consider issuing specified securities, in consolidation with bookrunning lead managers, aggregating up to 2 billion rupees in pre-IPO placement, its draft prospectus from December said. ADVERTISEMENT The company, which sells diamond, gold, platinum and studded jewellery, competes with Titan, Kalyan Jewellers and Tribhovandas Bhimji Zaveri among listed firms in India. Proceeds from the offering will be used to fund working capital requirements and general corporate purposes, the Bluestone prospectus showed. ADVERTISEMENT Axis Capital, IIFL Capital and Kotak Mahindra Capital are its bookrunning lead managers. ($1 = 87.7790 Indian rupees) ADVERTISEMENT (You can now subscribe to our ETMarkets WhatsApp channel)
Hindustan Times
37 minutes ago
- Hindustan Times
Trump again threatens 'very substantial' tariff hikes for India over Russian oil
By Andrea Shalal and Aftab Ahmed Trump again threatens 'very substantial' tariff hikes for India over Russian oil WASHINGTON/NEW DELHI -U.S. President Donald Trump said on Tuesday he would increase the tariff charged on imports from India from the current rate of 25% "very substantially" over the next 24 hours, in view of New Delhi's continued purchases of Russian oil. He also said a "zero tariff" offer for imports of U.S. goods into India was not good enough, alleging that India was "fuelling the war" in Ukraine. Trump's threat to India over its purchases of Russian oil started on July 31, when he announced a 25% tariff for Indian goods, along with an unspecified penalty. "They're fuelling the war machine, and if they're going to do that, then I'm not going to be happy," Trump told CNBC in an interview on Tuesday, adding that the main sticking point with India was that its tariffs were too high. "Now, I will say this, India went from the highest tariffs ever. They will give us zero tariffs, and they're going to let us go in. But that's not good enough, because of what they're doing with oil, not good." An Indian government source said that India's purchases of Russian oil have helped to stabilise global oil prices by easing the pressure on supplies from other regions. India, the world's third biggest oil importer and consumer, buys more than a third of the oil it needs from Russia. "If we stop buying Russian oil, who will replace those barrels to maintain balance and at the same time prevent the prices from shooting up? We don't want a repeat of 2022 when prices shot up to $137 a barrel," the source said, referring to the oil market spike around the time when Moscow's invasion of Ukraine began. The official spoke on condition of anonymity because the source was not authorised to speak to the media. Trump's latest comment followed a similar threat on Monday, which prompted India's Foreign Ministry to say the country was being unfairly singled out over its purchases of Russian oil. "It is revealing that the very nations criticising India are themselves indulging in trade with Russia ," it said in a statement issued late on Monday. "It is unjustified to single out India," it added. The EU conducted 67.5 billion euros worth of trade with Russia in 2024, including record imports of liquefied natural gas that totalled 16.5 million metric tons, the Indian ministry said. The United States continues to import Russian uranium hexafluoride for use in its nuclear power industry, palladium, fertilisers and chemicals, it added, without giving a source for the export information. The U.S. embassy and the EU's delegation in New Delhi did not immediately respond to a request for comment. Both the United States and EU have reduced their trade ties with Russia since it launched its full-scale invasion of Ukraine. SUDDEN RIFT India imported about 1.75 million barrels per day of Russian oil from January to June this year, up 1% from a year ago, according to data provided to Reuters by trade sources. It has faced pressure from the West to distance itself from Russia over the Ukraine war. New Delhi has resisted, citing its longstanding ties with Moscow and economic needs. India's National Security Adviser Ajit Doval is likely to go ahead with a scheduled visit to Russia this week, two government sources said. Foreign Minister S. Jaishankar is expected to visit in the coming weeks. The sudden rift between India and the U.S. has been deepening since July 31. Trump has said that from Friday he will impose new sanctions on Russia as well as on countries that buy its energy exports, unless Moscow takes steps to end the war with Ukraine. The trade tensions have caused concern about the potential impact on India's economy. The equity benchmark BSE Sensex .BSESN closed down 0.38%, while the rupee dropped 0.17% versus the dollar. This article was generated from an automated news agency feed without modifications to text.
