U.S. Tariffs Trigger 100,000 Job Losses In India's Diamond Sector

(MENAFN- KNN India) New Delhi, Aug 12 (KNN) India's gems and jewellery industry is facing one of its toughest crises in years, with nearly 100,000 workers in Gujarat's diamond-cutting and polishing sector losing their jobs since April 2025 due to steep U.S. tariffs.

The U.S., a major market for Indian polished diamonds and jewellery, first imposed a 10% tariff in April, then increased it to 25%, and most recently to 50%.

These sharp hikes have led to stalled exports, widespread order cancellations, and severe losses, particularly for small units in Bhavnagar, Amreli, and Junagadh.

Many of these workshops, dependent on contracts from larger firms, employ workers earning between Rs 15,000–Rs 20,000 per month.

India processes around 90% of the world's polished diamonds, with the U.S. being a primary export destination. The sudden tariff escalation has significantly eroded India's competitiveness against exporters like Turkey, Vietnam, and Thailand, which face lower or no such duties.

In Saurashtra, a major diamond-processing hub, several workshops have either cut production or shut down entirely. The slowdown has also begun to affect related sectors, including Rajasthan's gemstone industry, where exporters fear cascading economic effects.

Industry associations are calling for urgent intervention from the Indian government to initiate trade negotiations, explore alternative markets, and provide domestic relief measures such as duty drawbacks, tax concessions, and easier access to working capital.

Without swift action, stakeholders warn that the damage could extend far beyond job losses, affecting India's position as the world's leading diamond-processing hub.

This tariff shock highlights the vulnerability of export-dependent industries to geopolitical trade shifts and the pressing need for diversification and policy support.

(KNN Bureau)

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