How Will The 27% U.S. Tariff Affect Indian Consumers and Retailers of Lab Grown Diamonds?
Recently, the USA has announced the implementation of import tariffs ranging from 15% to 27% on products from other countries. The tariff rate on Indian imports is 27%. India, the second-largest lab grown diamond manufacturer will see impact on the price, market preference, and supply chain of lab made diamonds, due to this tariff.
In this blog, we talk about how this 27% tariff might affect Indian consumers and retailers of lab created diamonds.
Understanding the 27% tariff’s impact
The 27% tariff applies to both rough and polished diamonds, mined and lab grown diamonds that are imported from India into the US. This new tariff rate will impact not only the mined diamond industry, but also the rapidly growing segment of Indian-manufactured synthetic diamonds. Indian lab grown diamonds have gained significant U.S. market share in recent years.
India has a vibrant diamond industry, specifically, diamond cutting and polishing. This new tariff rate will impact the large number of US consumers of Indian diamonds for sure. It will also impact lab grown diamond consumers and retailers in India.
Immediate price impact for consumers
One of the most notable effects of this tariff will be on lab grown diamond prices. Industry experts have said that the prices could rise by 15-20%. This means, for an engagement ring made of lab created diamonds, if the current price is $4000, the future price could be $5000 or more.
Moreover, the prices will increase based on the various lab diamond categories. For instance, small diamonds that are under 0.30 carats, will see a higher price increase compared to medium and large diamonds.
Consumers are also accelerating their purchases to buy lab created diamonds at lower prices before the tariffs are added to the price tags.
Other than these immediate changes, the tariff will also have long-term effects for consumers. For instance, as the manufacturing or processing shifts to other locations, consumers might see changes in the quality of lab grown diamonds.
Also, as the supply chain of lab diamonds become more complex, consumers might face challenges with the authenticity and traceability of the diamonds.
Immediate impact for retailers
Retailers of lab grown diamonds and lab diamond jewelry will face many consequences, too. For instance, retailers will have to make a decision about whether they want to implement the new price on the existing inventory or offer them at the older, pre-tariff prices.
Another factor that retailers have to consider is the supply chain or how they source their lab grown diamonds. Many retailers are exploring purchasing diamonds from lab grown diamond manufacturers based in other countries that are closer and involve lesser supply chain costs.
The tariff has also led to an increased interest in alternative diamonds, such as moissanite and other diamond simulants, vintage and pre-owned diamonds, colored lab grown diamonds as center stones, and smaller and more simple designs.
Retailers of lab created diamonds will have to engage in educating their customers about the impact of the tariff to build trust. They might also come up with innovative financing for lab made diamonds, such as payment plans, etc. Retailers might also have to innovate with the jewelry designs to maximize the visual impact of the diamond jewelry.
Summing up
The new 27% tariff rate on mined diamonds and lab grown diamonds is definitely going to impact the overall diamond industry, the consumers and retailers. While consumers will face higher prices and retailers will have to navigate this complex challenge in the short-term, in the long-term, the lab grown diamond industry will align to consumer and market preferences.
As the lab grown diamond industry has always innovated and stayed ahead of the market trends and disruptions, this time too, lab grown diamond manufacturers and retailers will find an innovative solution that is favorable to them and consumers.
If you’re looking to explore the best lab grown diamonds at affordable rates, head to Grown Diamond Corporation. Grown Diamond Corporation is one of the largest manufacturers and suppliers of lab grown diamonds to the USA. The brand, based in India and USA, has been providing the best quality and variety of lab made diamonds. To see the diamond in person in the USA, head to JCK 2025, from June 6 to 9, 2025.
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