Middle East War Triggers 35% Crash in India’s Gem & Jewellery Exports

Surat | Gujarat — The ongoing conflict in the Middle East has sent shockwaves across India’s diamond and jewellery sector, triggering a sharp collapse in exports while forcing a dramatic spike in rough diamond imports. The latest figures released by the Gems and Jewellery Export Promotion Council paint a worrying picture for the industry, especially for Surat, the global hub of diamond cutting and polishing.

In March alone, India’s gem and jewellery exports fell by a staggering 35%, reflecting the immediate fallout of disrupted trade routes and stalled demand from key markets. Industry experts say exports to Dubai and several European destinations came to a near standstill as geopolitical tensions escalated.

According to official data, diamond jewellery exports dropped from ₹23,821.76 crore in March 2024 to ₹16,597.20 crore in March 2025, marking a steep 35.23% decline in just one year. Cut and polished diamonds — Surat’s flagship segment — also suffered heavily, with exports falling 27.48% from ₹10,002.52 crore in March 2024 to ₹7,798.82 crore in March 2025.

“The Middle East conflict has disrupted demand and logistics simultaneously, creating a double blow for exporters,” said an industry representative. “Key trading hubs slowed down overnight, leaving shipments stuck and orders cancelled.”

Rough diamond imports jump 312%

While exports plunged, imports of rough diamonds surged dramatically, signalling a strategic shift by manufacturers preparing for future demand recovery. Rough diamond imports rose from ₹442.62 crore in March 2024 to ₹1,955.41 crore in March 2025 — an extraordinary jump of 312.15%.

Experts believe companies are stockpiling raw materials while prices remain relatively favourable and supply chains remain open outside conflict zones. “Manufacturers are building inventory to stay ready for the next growth cycle,” said a Surat-based exporter. “This is a survival strategy during uncertainty.”

Annual exports also slip into negative territory

The financial year ending March 2026 confirms a broader slowdown. Cut and polished diamond exports dropped 8.52% year-on-year, falling from $13,292.43 million in FY 2024–25 to $12,159.83 million in FY 2025–26.

Industry leaders attribute the decline to multiple global pressures, including tariffs imposed by the United States Government and the escalation of the Middle East war earlier this year.

Diamond jewellery exports also recorded their first negative growth in years, declining 3.32% annually. Exports were disrupted for nearly seven months due to trade tariffs and the conflict’s ripple effects.

“This is the first time the sector has recorded negative returns after years of consistent growth,” an exporter said. “But the industry has survived crises before and will adapt again.”