Bhavnagar: 

US President Donald Trump has recently imposed tariffs on multiple countries, including India. Among the affected exports is Bhavnagar’s renowned diamond industry. Both Bhavnagar’s polished diamonds and diamond-studded jewellery have a strong demand in the US. However, the new tariffs have added fresh challenges to an industry that has already been struggling with a three-year recession.

 Several industries across the country are bracing for impact following the imposition of tariffs by the United States. Sectors such as electronics, iPhone components and especially the diamond industry are expected to be significantly affected. A looming question now hangs over Bhavnagar’s diamond trade--will this latest move deepen the recession already gripping the region’s diamond industry--which supports the livelihoods of millions?

What’s the Difference Between the Previous and Current Tariffs?

This sudden increase has sent shockwaves through the market. Patel added, “If these tariffs remain for long, the industry could be deeply affected. However, it's still unclear how long this impact will last.”

The US has now imposed a 26% tariff on Indian goods, directly impacting the diamond sector. Ghanshyam Patel, President of the Bhavnagar Diamond Association, shared, “Earlier, there was zero per cent (0%) tariff on polished diamonds and a six per cent (6%) tariff on diamond jewellery. Now, polished diamonds are subject to a 26% tariff, and jewellery faces a 32% tariff.”

Will the Diamond Business Decline Further?

Patel highlighted the industry's struggle, saying, “Thousands in Bhavnagar city and district depend on the diamond business for their livelihood. Due to the ongoing recession, many have already left the industry, and currently, no one is entering the trade. We’re not seeing new diamond artisans being trained. If the demand continues to fall because of the tariffs, the industry may shrink further.”

Merchants Left in Uncertainty:

The sudden tariff hike has left Bhavnagar's diamond merchants confused and concerned. “It’s only been two days since the tariffs were implemented,” said Patel. “The impact is yet to fully unfold. For now, most traders have paused their operations because the cost of our goods will rise by nearly 25%. Whether the US continues to purchase under these new prices is uncertain. We must wait and see if American demand for diamonds persists.”

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