Trump Tariff Bombshell Shakes Indian Gems and Jewellery Export Industry

Gems News: A Sudden Blow from Washington

India’s multibillion-dollar diamond and gemstone industry has been rocked by the sudden announcement of a steep 25% tariff imposed by former U.S. President Donald Trump on imports from India. The abrupt decision, made public through a series of fiery social media posts, has thrown the global jewelry supply chain into a tailspin and left Indian exporters scrambling to assess the fallout.

India’s gems and jewelry export industry is being rattled by Trump’s new tariffs.
Image Credit: GJEPC

Effective today, the new levy will add to existing import duties already in place. The cumulative impact is expected to raise tariffs on Indian gold jewelry to a staggering 31.5%–33%, and gemstones to approximately 31%–32%. This Gems News report has drawn swift condemnation from both industry insiders and trade officials.

Mixed Signals from Trump Add to Uncertainty

Trump’s online outburst against India, which included scathing remarks about the country’s economic ties with Russia, has left observers confused about the future of bilateral trade. Although he later told reporters that his team was “talking to India,” his midnight Truth Social post—where he said India and Russia could “take their dead economies down together”—suggested little room for compromise.

Media reported that Indian government officials were “shocked and disappointed” by the surprise escalation. Industry leaders echoed the sentiment. Kirit Bhansali, chairman of India’s Gem & Jewellery Export Promotion Council (GJEPC), called the tariff “deeply concerning” and warned it would apply “immense pressure on every part of the value chain.” He urged both governments to enter meaningful dialogue to avoid long-term damage to trade and employment.

Exporters and Retailers Sound the Alarm

Colin Shah, managing director of Kama Jewelry and former GJEPC chairman, didn’t mince words: “This is a big blow for India. We’ve already been dealing with global tensions for over two years—Russia, Ukraine, the Middle East. Now with Trump’s return and this tariff, the Indian gem and jewelry sector could go into a freeze.”

On the American side, jewelry retailers are equally uneasy. David Bonaparte, president and CEO of Jewelers of America, warned that these tariffs are “a tax on businesses that have no choice but to source their goods from overseas.” He noted that the industry has already endured a 10% tariff since April, and the new hike would be “extremely detrimental.”

Jewelers of America is currently lobbying for exemptions, especially for diamonds and gemstones that are not mined in the U.S.

Retailers Brace for Price Shock but See Silver Lining

Some Indian-American dealers are trying to stay optimistic. Nicky Mehta, head of business development for Ashi Diamonds, acknowledged short-term pain but speculated the tariffs might cause natural diamond prices to dip, making them more appealing to younger consumers. “If prices fall slightly, we might see increased sales. It could drive volume even if margins are thinner.”

Mehta also noted that consumers across the board are dealing with price hikes in other categories. “People will adjust. Jewelry purchases might slow, but they won’t stop entirely.”

Another anonymous Indian dealer predicted that the tariffs could last four to six months, suggesting the industry will adapt as it has in the past. “We’ve been through these kinds of shocks before. What matters is whether both sides are willing to find common ground.”

The Jewelers Vigilance Committee has launched an online tariff tracker to help businesses monitor the evolving situation.

Ripple Effects Could Reshape Global Jewelry Trade

The ramifications of Trump’s tariff bombshell are likely to ripple far beyond India’s borders. With the U.S. being one of the largest consumers of Indian gems and jewelry, the new duties could trigger a major reshuffling of sourcing strategies and pricing models worldwide. Retailers may look toward other markets for supply, while Indian exporters might shift focus to regions like the Middle East or Southeast Asia to offset losses.

Still, the sheer scale and abruptness of the tariff increase has jolted the industry. For many small and medium enterprises within India’s gem sector, which employs millions and supports countless families, these tariffs are more than a business inconvenience—they are an existential threat.

Whether this escalation turns into a prolonged standoff or a temporary disruption will depend largely on the political winds in Washington and New Delhi. For now, the only certainty is uncertainty, and businesses on both sides of the ocean are bracing for turbulent times ahead.

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