Imagine a scenario where a single trade deal could dramatically reshape an entire industry, sparking both relief and debate. That’s exactly what’s happening with the India-US interim trade agreement and its impact on the Indian gems and jewellery sector. But here’s where it gets controversial: while the deal promises zero-duty access for diamonds and colored gemstones to the US market, not everyone agrees on its long-term benefits—especially when it comes to lab-grown diamonds and synthetic gemstones. Let’s dive in.
Published by Kumar on February 9, 2026, this article sheds light on the mixed emotions within the Indian gem and jewellery industry. The sector has been reeling from the effects of increased US tariffs over the past year, which saw India’s cut and polished diamond exports to the US—its largest market—plummet by a staggering 60%, from USD 3.64 billion to USD 1.45 billion. For context, this drop wasn’t just a number; it represented lost jobs, stalled investments, and shaken confidence in the market. So, when the interim trade deal announced zero tariffs on gems and diamonds, it was a sigh of relief for many.
And this is the part most people miss: while the deal is a win for traditional gemstone exporters, it leaves out lab-grown diamonds and synthetic gemstones, which are gaining traction globally. Gems and Jewellery Export Promotion Council chairman Kirit Bhansali expressed satisfaction with the zero-duty access, but the Council has already appealed to the government to expand the exemption list. Why? Because excluding these innovative products could stifle India’s growing role in the synthetic gemstone market, a sector poised for exponential growth.
Under the interim framework, tariffs on generic drugs, aircraft parts, and gems and diamonds will drop to zero, intensifying competition among exporters. This aligns with India’s Make in India initiative, potentially boosting exports, creating jobs, and restoring market confidence. Duties have already been slashed to 18%, providing immediate relief, and the industry hopes for full duty-free status by March when the agreement is finalized.
Here’s the bold question: Is India missing an opportunity by not including lab-grown diamonds in this deal? While traditionalists argue that synthetic gems lack the allure of natural stones, others see them as the future of a sustainable, cost-effective industry. What do you think? Should India push for a more inclusive trade deal, or is this a step too far? Let’s spark a conversation in the comments below.
