Surat Diamond Industry Hit Hard by G7 Russian Diamond Import Ban

Surat: The Surat diamond industry, the world’s largest diamond cutting and polishing center, faces a significant setback following the unanimous decision by the G7 countries to impose a direct import ban on Russian diamonds effective from January 2024.

This decision, however, comes with a commitment from the G7 nations to develop a robust verification mechanism to halt the influx of Russian diamonds by September 2024.

Russia, renowned as the globe’s foremost diamond producer, with annual diamond sales ranging between $4 billion to $4.5 billion, has been a vital source for Surat’s diamond trade.

The rough diamonds from Russian mines, primarily operated by Alrosa, a state diamond mining company, have substantially benefited Surat. Last year alone, Russia garnered around $4 billion from the diamond trade, contributing to the country’s financial resources, including its military operations against Kyiv.

The G7 consortium, comprising Canada, France, Germany, Italy, Japan, the U.S., and the U.K., collectively representing 70% of the world’s diamond market, deliberated and reached an agreement imposing import restrictions, directly impacting the diamond industry’s dynamics in Surat.

Industry insiders anticipate a profound effect on Surat’s diamond trade due to the import prohibition on Russian rough diamonds. This decision is expected to empower diamond mining giants like De Beers, potentially leading to a surge in rough diamond prices owing to heightened demand from key players in Surat’s diamond industry.

In a joint statement, the G7 stated, “We will introduce import restrictions on non-industrial diamonds mined, processed, or produced in Russia by January 1, 2024, followed by further phased restrictions on the import of Russian diamonds processed in third countries, targeting March 1, 2024.”

Expressing apprehension, the Diamond Workers Union Gujarat (DWUG) voiced concerns about substantial job losses within the diamond industry post the import ban on Russian goods by G7 countries.

Bhavesh Tank, vice-president of DWUG, conveyed, “During the visit of the G7 representatives in Surat, we highlighted the concerns regarding job losses in Surat’s diamond industry. If the G7 took the decision against Russia on humanitarian grounds, then they must also consider the human impact on diamond artisans facing potential joblessness.”

The G7’s decision echoes a pivotal juncture for Surat’s diamond industry, signaling an impending transformation that could substantially alter the global diamond trade landscape.