{"id":35158,"date":"2026-02-09T16:27:07","date_gmt":"2026-02-09T10:57:07","guid":{"rendered":"https:\/\/gjepc.org\/solitaire\/?p=35158"},"modified":"2026-02-11T14:43:09","modified_gmt":"2026-02-11T09:13:09","slug":"a-new-dawn-for-india-us-trade-zero-duty-framework-to-revitalise-gem-jewellery-sector","status":"publish","type":"post","link":"https:\/\/gjepc.org\/solitaire\/a-new-dawn-for-india-us-trade-zero-duty-framework-to-revitalise-gem-jewellery-sector\/","title":{"rendered":"A New Dawn for India-US Trade: Zero-duty Framework to Revitalise Gem & Jewellery Sector"},"content":{"rendered":"

The Indian gem and jewellery industry has received a monumental boost following the landmark announcement of a framework for an Interim Agreement between India and the US. Solitaire International<\/strong> spoke to key industry leaders<\/strong> whose feedback has been overwhelmingly positive, hailing the move as a \u201cdecisive turning point\u201d and a \u201cmomentous\u201d occasion for the sector. <\/em><\/p>\n

A sharp policy turn in India\u2013US trade has injected fresh confidence and hope into a sector that has spent the past year absorbing tariff shocks. This strategic pivot, marked by the announcement of zero-duty access for diamonds and coloured gemstones, is being hailed as a decisive turning point after months of sustained headwinds.<\/p>\n

The announcement of a framework for an interim trade agreement between India and the United States has put the Indian gem and jewellery sector back on the front foot, with zero-duty access for diamonds and coloured gemstones and jewellery tariffs reduced to 18%. After a year marked by shrinking orders and squeezed margins, exporters now see a direct path to price competitiveness in their largest market.<\/p>\n

At the centre of the industry response is Gem & Jewellery Export Promotion Council (GJEPC), which had been lobbying for tariff relief across categories for more than a year, building a steady, step-by-step case that diamonds, coloured gemstones and laboratory-grown stones should be treated as essential raw materials rather than finished goods.<\/p>\n

India became the first country to formally propose the inclusion of these categories under the US exemption framework. GJEPC then worked closely with the Ministry of Commerce & Industry to embed the sector\u2019s concerns into official India-US trade discussions.<\/p>\n

On 16 March 2025, the proposal was taken global at the International Diamond Manufacturers Association (IDMA) Presidents\u2019 Meeting in New York, where inclusion of cut and polished diamonds was formally tabled. By 1 May 2025 in London, the strategy accelerated through coordinated outreach and calls for global backing, culminating in a unified industry voice led by the World Diamond Council.<\/p>\n

From there, momentum built quickly. On 5 September 2025, the US announced Annexure benefits for aligned partner nations covering diamonds and coloured gemstones, and on 7 February 2026, the India-US Interim Agreement framework outlined zero-duty access for these categories. The effort moved from representation to alignment, and finally to policy, laying the groundwork for the zero-duty outcome now reflected in the framework.<\/p>\n

\"\"<\/p>\n

Kirit Bhansali, Chairman, GJEPC<\/strong>, said: \u201cThe Indian gem & jewellery industry is elated by the announcement of zero-duty access for diamonds and coloured gemstones to the US under the Interim Agreement framework \u2014 a decisive turning point that breathes new life into the sector.<\/p>\n

\u201cThe diamond sector had taken a severe hit over the past year, with India\u2019s cut and polished diamond exports to the US \u2014 our largest market \u2014 declining by over 60%, from USD 3.64 billion in April\u2013December 2024 to USD 1.45 billion in April\u2013December 2025, as tariffs eroded competitiveness.<\/p>\n

\u201cUnder the announced framework, duties have been reduced to 18% on jewellery, which itself provides meaningful relief to exporters. We are confident that, upon conclusion of the Interim Agreement, diamonds and coloured gemstones will receive full zero-duty treatment as envisaged, restoring competitiveness in our most critical market.<\/p>\n

\u201cThese efforts were actively taken up by the Government of India with the United States. We applaud and sincerely commend the Hon\u2019ble Prime Minister, Shri Narendra Modi, US President Mr. Donald Trump & Hon\u2019ble Commerce & Industries Minister Shri Piyush Goyal and the entire government machinery for the remarkable speed and efficiency in reaching this framework within days of the announcement of the deal, a testament to visionary leadership and an unwavering commitment to strengthening India-US trade ties.<\/p>\n

The Council has also taken up with the Government of India the need to pursue inclusion of laboratory-grown diamonds and synthetic gemstones under the Annexure III exemption list of US tariffs.\u201d<\/p>\n

For many exporters, the math is immediate. Zero duty on loose natural stones sharply improves viability, especially in higher-value segments.<\/p>\n

Here\u2019s how industry voices are reading the shift:<\/p>\n

\"\"<\/p>\n

Ashish Borda<\/strong>, Convener \u2013 Promotion, Marketing & Business Development Sub-committee, GJEPC,<\/strong> commented: \u201cThe interim zero-duty announcement is a positive signal for the industry, with expectations of swift implementation that will lead to a strong rebound in exports.<\/p>\n

\u201cThe earlier duty regime had been particularly challenging for SMEs, which lacked the ability to absorb steep costs. The move by the Trump administration comes as a timely confidence booster for the sector.\u201d<\/p>\n

\"\"Dinesh Lakhani – Group Director, Kiran Gems Pvt. Ltd., <\/strong>said, \u201cThe Interim Trade Agreement between India and the United States leading to removal of tariffs is a timely and positive step for the Indian gems and jewellery industry. For a sector that thrives on trust, long-term relationships, and global collaboration, this development restores both competitiveness and confidence – especially in the natural diamond segment, where India plays an unmatched role in value addition and scale.<\/p>\n

\u201cThe United States has always been one of the most important markets for Indian diamonds and jewellery. The earlier tariff challenges had disrupted demand, pricing structures, and supply chains, creating pressure across the ecosystem- from large manufacturers to small artisans. The tariff relief provides immediate breathing space, allowing Indian exporters to re-engage with US partners on more equitable terms and rebuild momentum that was temporarily lost.<\/p>\n

\u201cFor natural diamonds, this is particularly significant. India is not just a supplier; it is the global centre for precision cutting, ethical sourcing practices, and consistency of supply. Lower trade barriers reinforce India\u2019s position as a trusted partner in the global diamond value chain and help sustain millions of livelihoods linked to this industry.<\/p>\n

\u201cI would like to express my sincere gratitude to the Government of India for its proactive and pragmatic approach in trade negotiations. The ability to balance national interests with the realities of global trade reflects strong leadership and a deep understanding of export-driven industries. I also commend the Gem & Jewellery Export Promotion Council (GJEPC) for its persistent representation of industry concerns and constructive engagement with policymakers.\u201d<\/p>\n

New Perspectives \u2013 Additional Opportunities Beckon <\/em><\/strong><\/p>\n

\u201cApart from the above listed positive developments, we also need to realise that there are additional opportunities over and above the existing business in our gems & Jewellery manufacturing sector.<\/p>\n

\u201cThe next frontier is strategic: India now hosts world-class management, design, analytics, and retail-operations talent, evidenced by global financial and modern retail firms running GCCs from India. With tariff rationalisation across developed markets (EU, UK apart from USA), the global premium and luxury retail industry can increasingly view India not just as a product supplier, but as an end-to-end global hub\u2014integrating manufacturing, design, brand management, and technology services.<\/p>\n

\u201cAs we look ahead, I am optimistic that this progress will lead to a comprehensive agreement and many other positive outcomes that supports sustainable growth, strengthens bilateral trade, and allows the Indian gems and jewellery industry – especially natural diamonds – to shine even brighter on the global stage.\u201d<\/p>\n

\"\"<\/p>\n

Shreyans Dholakia<\/strong>, Entrepreneur-Brand Custodian, Shree Ramkrishna Exports (SRK),<\/strong> said: \u201cThe India-US Interim Trade Agreement is an important step towards a stable, reciprocal, and future-oriented trade partnership. For the gems and jewellery sector, where the United States remains our largest export market, this agreement opens new avenues for trade, investment and value creation.<\/p>\n

\u201cSuch outcomes highlight the importance of sustained industry\u2013government engagement, including the constructive role played by institutions such as GJEPC and FICCI in representing sectoral perspectives. This framework strengthens supply-chain resilience and a shared commitment to balanced, long-term economic cooperation.\u201d<\/p>\n

\"\"<\/p>\n

Adil Kotwal<\/strong>, President, SEEPZ Gems & Jewellery Manufacturers\u2019 Association (SGJMA),<\/strong> added: \u201cThe agreement is very positive for the natural diamond trade. Bringing tariffs on loose natural diamonds down to 0% is a big relief, especially for larger stones like 1 or 2 carats, where an 18% duty would have made jewellery significantly more expensive. This should give a strong boost to manufacturers focused on bigger, high-value stones.<\/p>\n

\u201cLab-grown diamonds, however, remain at 18% despite growing US consumer preference for LGDs.<\/p>\n

\u201cOn jewellery, moving from the earlier 50% tariff to 18% at least creates a level playing field with competing Asian markets such as Vietnam, Hong Kong, China and Bangkok.<\/p>\n

\u201cIndia also has an edge because we finance the business, often extending credit from 2-6 months, while many competitors operate on upfront payments. Combined with our design and manufacturing strength, we remain competitive and, in fact, better positioned under these conditions.\u201d<\/p>\n

\"\"<\/p>\n

Ajesh Mehta<\/strong>, Co-opted Member, Diamond Panel, GJEPC,<\/strong> said: \u201cThe India-US trade agreement is a major step forward, particularly with tariffs on natural diamonds reduced to 0%. The industry had been awaiting this for a long time. It creates clear gains for India\u2019s diamond cutting & polishing sector as well as the US jewellery manufacturing trade.<\/p>\n

\u201cGiven that the US is our largest market, the impact will be significant. However, jewellery tariffs remaining at 18% is a concern, as setting small diamonds in the US may not be economically viable, though larger stones should remain unaffected.<\/p>\n

\u201cThe exclusion of lab-grown diamonds appears protectionist. Since most LGDs are cut and polished in India, a 0% duty would have supported both industries.\u201d<\/p>\n

\"\"<\/p>\n

Colin Shah<\/strong>, MD, Kama Jewelry,<\/strong> said: \u201cThe announcement of zero tariff on gems & diamonds is a momentous one and well rejoiced by the Indian gems & jewellery sector. India being the global hub for diamond processing was impacted severely due to the trade tariffs, where trade had dropped over 60% when it comes to cut & polished diamonds. The waiver of tariff will help revive exports and reinstate the sparkle in business.<\/p>\n

\u201cWe are thankful to the Indian Government and Ministry Of Commerce for the negotiation, as this will not just give a fillip to the sector but also go a long way in adding substantial value to the goal of Aatmanirbhar Bharat.\u201d<\/p>\n

Taken together, the collective message is grounded rather than euphoric. Stones regain zero duty. Jewellery sees partial relief at 18%. Lab-grown remains unresolved. Still, the core input-cost barrier has dropped, and that single shift changes the physics of trade. When pricing realigns, orders tend to follow.<\/p>\n","protected":false},"excerpt":{"rendered":"

The Indian gem and jewellery industry has received a monumental boost following the landmark announcement of a framework for an Interim Agreement between India and the US. 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