{"id":31010,"date":"2025-04-14T14:17:11","date_gmt":"2025-04-14T08:47:11","guid":{"rendered":"https:\/\/gjepc.org\/solitaire\/?p=31010"},"modified":"2025-04-16T11:48:38","modified_gmt":"2025-04-16T06:18:38","slug":"for-gems-and-jewellery-india-key-to-ongoing-trade-negotiations-with-u-s","status":"publish","type":"post","link":"https:\/\/gjepc.org\/solitaire\/for-gems-and-jewellery-india-key-to-ongoing-trade-negotiations-with-u-s\/","title":{"rendered":"For Gems and Jewellery India Key to Ongoing Trade Negotiations with U.S."},"content":{"rendered":"

Diamond analyst <\/span><\/span>Paul <\/span>Zimnisky<\/span><\/span><\/strong> explores how recent U.S. tariff adjustments and ongoing trade negotiations with India could significantly <\/span>impact<\/span> the industry<\/span>, given <\/span>India\u2019s dominant role in <\/span>gem and jewellery <\/span>manufacturing, particularly diamonds<\/span>.<\/span><\/span>\u00a0<\/span><\/em><\/p>\n

In addition, to the multitude of factors already impacting the competitiveness of the global gems and jewellery industry, <\/span>tariffs will now inevitably play a more pertinent role<\/span><\/a> for the foreseeable future.\u00a0<\/span>\u00a0<\/span><\/p>\n

The much more aggressive than anticipated tariff schedule on 60 nations announced by the U.S. in early-April sent shockwaves through the global economy. Despite the Trump administration\u2019s bombastic approach, the move can be seen as just another chapter in the major global supply chain reshuffling that has been happening for years now \u2013 you can call it deglobalisation.\u00a0<\/span>\u00a0<\/span><\/p>\n

Somewhat overshadowed by the Covid-19 pandemic that followed shortly thereafter, the tariffs imposed on China by President Trump\u2019s first administration in 2018 and 2019 implicated the trade\u2019s supply chain. During an analyst call in September 2019, Signet Jewelers, the largest jewellery seller in America, unequivocally noted: \u201cwe have been successful in working with our vendors to move a significant amount of our China exposure to other countries\u2026by fiscal 2020 year-end, we expect our merchandise spend exposure to China to be in the mid-teens on a percentage basis,\u201d which compared to approximately 30% just six months prior.\u00a0<\/span>\u00a0<\/span><\/p>\n

At the time, Signet management also specified that it did \u201cnot expect to pass along price increases to customers as a result of tariffs.\u201d<\/span>\u00a0<\/span><\/p>\n

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Paul Zimnisky<\/figcaption><\/figure>\n

In an another somewhat forgotten development, in 2021, the U.S., under the Biden administration, had a trade spat with India over a \u201cdigital service tax\u201d which it felt was unfairly punitive towards U.S. e-commerce companies such as Amazon (it is estimated that Amazon holds a 30% share of India\u2019s e-commerce market). The U.S. threatened to impose a 25% tariff on a range of Indian imports \u2013 half of which were specifically jewellery-related items. The U.S. did not end up implementing the tariffs and in March 2025, India abolished a \u201cdigital ad tax\u201d (that disproportionately impacted U.S. big tech) in a somewhat related concession.\u00a0<\/span>\u00a0<\/span><\/p>\n

In recent decades, India has clearly positioned itself as a leader in gemstone and jewellery manufacturing. India has a skilled and scaled labour force, has actively leveraged technology to improve efficiency and has had the support of the government in providing financing and infrastructure to stimulate a robust domestic industry. A notable number of astute Indian businessmen have had great success putting all these pieces together \u2013 for context, almost half of De Beers\u2019 Sightholders are Indian companies.<\/span>\u00a0<\/span><\/p>\n

Getting back to today, as the economic world order shifts, a swiftly negotiated mutually beneficial trade deal between the U.S. and India could certainly provide long-term support to India’s position as an industry leader in gems and jewellery manufacturing and trade.\u00a0<\/span>\u00a0<\/span><\/p>\n

As it stands, the initial 26% U.S. tariff on virtually all Indian goods, excluding bullion, has been reduced to 10% as of 12<\/span>th<\/span> April. This comes as Trump ostensibly directs his focus to China in an effort to claw back America\u2019s trade imbalance (the U.S. tariff on China has been escalated to well over 100%). In terms of ensuing trade alliances with the U.S., nations including Canada, Mexico and India seem well positioned to benefit. Canada and Mexico are likely to gain from the standing USMCA free-trade agreement, and India from a standing cordial mutually-beneficial relationship with America.<\/span>\u00a0<\/span><\/p>\n

Despite, what is a complex and fluid situation, Shaunak Parikh, Vice Chairman of the GJEPC encouragingly told <\/span>Reuters<\/span><\/i>: \u201cwe’re pretty hopeful that India could land a trade deal with the U.S. in the next few months\u2026so, we just need to push through this tough phase for a little while long.\u201d This was on the back of a February meeting between the countries two leaders where President Trump called Prime Minister Modi a \u201cgreat leader\u201d and Modi called Trump a \u201cfriend.\u201d\u00a0<\/span>\u00a0<\/span><\/p>\n

As it pertains to gemstones tariffs, the origin is considered where it was \u201csubstantially transformed,\u201d i.e. cut-and-polished. Thus, India \u2013 with its 90% share of global diamond manufacturing \u2013 is key to the ongoing trade negotiations, especially when it comes to diamonds. It is worth noting that metal bullion imported into the U.S. is exempt from the tariffs, however rough diamonds are subject to the tariffs, discouraging incentive for the U.S. to manufacture goods domestically.<\/span>\u00a0<\/span><\/p>\n

\n

Paul Zimnisky, CFA is an independent diamond industry analyst and consultant based in the New York metro area. For regular in-depth analysis and forecasts of the diamond industry please consider subscribing to his <\/span><\/i>State of the Diamond Market<\/span><\/i><\/a>, a leading monthly industry report; an index of previous editions can be found <\/span><\/i>here<\/span><\/i><\/a>. Also, listen to the <\/span><\/i>Paul Zimnisky Diamond Analytics Podcast<\/span><\/i><\/a> on Spotify or Apple Podcasts for exclusive full-length conversations with special guests from the gem and jewelry industry. Paul is a graduate of the University of Maryland’s Robert H. Smith School of Business with a B.S. in finance and he is a CFA charterholder. He can be followed on X <\/span><\/i>@paulzimnisky<\/span><\/i><\/a> and on YouTube <\/span><\/i>@paulzimnisky<\/span><\/i><\/a>.<\/span><\/i>\u00a0<\/span><\/p>\n

Paul will be speaking on \u201cWhat the Future Holds for Diamonds\u201d at the Swiss Gemmological Society Central Conference in Wilen (Sarnen), Switzerland on June 16, 2025.\u00a0<\/span><\/i>\u00a0<\/span><\/p>\n

Disclosure: At the time of writing Paul Zimnisky held a long equity position in Brilliant Earth Group and Newmont Corp. Paul is an independent board member of Lipari Mining Ltd, a publicly-traded Canadian company with an operating diamond mine in Brazil and a development-stage asset in Angola. None of the above constitutes investment advice, please read full disclosure at <\/span><\/i>www.paulzimnisky.com<\/span><\/i><\/a>.<\/span><\/i>\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Diamond analyst Paul Zimnisky explores how recent U.S. tariff adjustments and ongoing trade negotiations with India could significantly impact the industry, given India\u2019s dominant role in gem and jewellery manufacturing, particularly diamonds.\u00a0 In addition, to the multitude of factors already impacting the competitiveness of the global gems and jewellery industry, tariffs will now inevitably play…<\/p>\n","protected":false},"author":7,"featured_media":31013,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[106,79],"tags":[],"thb-sponsors":[],"class_list":["post-31010","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-manufacturing","category-viewpoint"],"acf":[],"yoast_head":"\nFor Gems and Jewellery India Key to Ongoing Trade Negotiations with U.S. - Solitaire magazine is a International jewellery magazine - India\u2019s leading B2B gem and jewellery magazine<\/title>\n<meta name=\"robots\" content=\"index, follow\" \/>\n<meta name=\"googlebot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta name=\"bingbot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/gjepc.org\/solitaire\/for-gems-and-jewellery-india-key-to-ongoing-trade-negotiations-with-u-s\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"For Gems and Jewellery India Key to Ongoing Trade Negotiations with U.S. - 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