US Ban on Russian Diamonds Deals a Crushing Blow to Surat

Surat :  In a move that sent shockwaves through the global diamond industry, the United States has slammed the door shut on Russian diamonds, even if they were polished in a third country like India. This executive order, signed by President Joe Biden, effectively eliminates a loophole that had allowed stones processed in Surat, the world’s largest diamond cutting and polishing center, to enter the US market.

For Surat, which relies heavily on the US market for over 45% of its polished diamond exports, the blow is immense. Industry experts warn of a ripple effect, with dependence on De Beers, the diamond giant, expected to inflate rough diamond prices and squeeze smaller players.

“This is a major setback,” admitted a Surat-based rough diamond dealer, his voice laced with concern. “The rough diamond prices have already spiked 10-15% since the G7 ban on Russian diamonds, and the US order will only add fuel to the fire.”

The executive order aligns with a December statement from G7 leaders calling for stricter measures on Russian diamond imports. While the US hasn’t specified a timeline, the immediate impact is undeniable.

“The US is our biggest diamond buyer,” explained another industry insider. “With this ban, Surat’s diamond polishers are left scrambling for alternative markets. De Beers, with its control over rough diamonds, now holds the cards, and prices are bound to skyrocket.”

The US ban stems from its broader sanctions against Russia following its invasion of Ukraine. While the initial sanctions contained a loophole for diamonds polished in third countries, many American retailers and consumers had already voluntarily boycotted all Russian diamonds.

“This is about holding Russia accountable for its aggression,” declared US National Security Adviser Jake Sullivan. “Together with our allies, we’re committed to crippling Russia’s war machine and sending a clear message: war has consequences.”

For Surat, however, the consequences are far from clear. The once-booming diamond capital now faces an uncertain future, its fate intricately linked to the whims of a volatile global market and the powerful grip of De Beers.

“The question remains: will Surat’s diamond polishers be able to weather this storm, or will their luster fade under the pressure of sanctions and shifting sands? Only time will tell.” Said a diamond industry analyst.