Nearly 100,000 workers in Gujarat’s Saurashtra region have lost their jobs since the United States imposed a steep tariff hike on imported diamonds. The baseline 10% tariff, introduced in April, was later raised to 25% and then doubled to 50%, creating uncertainty and disrupting the diamond trade.
Small Units Bear the Brunt
Most layoffs have occurred in small cutting and polishing units in Bhavnagar, Amreli, and Junagadh. These workshops typically process diamonds for larger exporters but are now grappling with delayed or cancelled US orders. Many affected workers, who earned ₹15,000–₹20,000 a month, have been forced to seek alternative employment or return to their hometowns.
Shift Towards Lab-Grown Diamonds
Some displaced workers are finding opportunities in the lab-grown diamond (LGD) sector. However, industry leaders warn that if LGDs are also hit by the 50% tariff, the employment impact could become far worse, as the US remains the biggest market for these products.
Exporters Voice Concerns
Large companies are cautious about publicly disclosing layoffs, but industry insiders confirm reduced production, temporary shutdowns, and shorter shifts. For exporters like Kiran Gems and Gallant Jewellery, the tariffs are squeezing margins and threatening long-term viability. US buyers are even exploring shifting manufacturing to countries like Vietnam and Thailand, where tariffs are lower.
India’s Global Diamond Dominance at Risk
India processes roughly 90% of the world’s diamonds and is the largest exporter to the US, sending $10 billion worth of gems and jewellery there in FY25. The tariff hike, if left unresolved, could erode India’s competitive edge and push buyers towards alternative supply chains.
Calls for Government Intervention
Industry representatives are urging the Indian government to fast-track bilateral trade talks with Washington to address the tariff gap. They are also seeking export incentives, interest subsidies, and faster GST refunds to support struggling businesses. Without timely measures, the ripple effects could extend beyond Saurashtra to Surat — the heart of India’s diamond industry.
60-word Summary:
A steep US tariff hike on diamonds has cost nearly 100,000 jobs in Gujarat’s Saurashtra region, crippling small cutting and polishing units. Export orders are delayed or cancelled, and some workers are shifting to lab-grown diamonds.
