US Tariffs Hit India’s Diamond Cutting & Polishing Sector Hard — Nearly 1 Lakh Workers Affected
India’s diamond cutting and polishing sector — especially small units in Bhavnagar, Amreli, and Junagadh — is facing an unprecedented crisis after steep hikes in US import tariffs.
According to a report by The Economic Times, nearly 100,000 workers in Gujarat’s Saurashtra region have lost their jobs within days of the US doubling its tariffs on Indian polished diamonds from 10% to 20%, and then further increasing them to 50%.
Industry insiders reveal that orders from US buyers have been cancelled or indefinitely put on hold, dealing a severe blow to smaller processing units that rely heavily on exports. The impact is visible in centres like Bhavnagar and Amreli, where workshops have shut down and workers are returning to their villages in search of other livelihoods.
“Job losses are mostly in small units. The US and China together account for the largest share of India’s diamond exports, and these tariffs have created a massive supply shock,” said Bhavesh Tank, Vice President, Diamond Workers Union, Gujarat.
Lab-Grown Diamonds (LGD) in the Spotlight
While the natural diamond segment is reeling from the tariff hike, industry experts note that the lab-grown diamond sector may also feel the ripple effect if US demand slows down. The US remains the largest market for LGDs globally.
GJEPC Chairman Vipul Shah has urged the government to take up the issue diplomatically with the US to safeguard the livelihoods of lakhs of workers and protect India’s export share in the global diamond trade.
Economic Impact
In FY25, India exported gems and jewellery worth over $10 billion to the US, with diamonds being the top category. A sustained drop in orders from America could have a cascading effect on India’s polishing hubs, logistics providers, and related supply chains.
Prominent industry voices, including Arvind Gupta of Galaxy Jewel, warn that unless the tariff issue is resolved quickly, smaller towns could see unemployment levels spike to crisis levels.
Source: This article is based on a report originally published in The Economic Times (August 12, 2025), with additional inputs and context by the JewelBharat News Desk.
