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New Delhi: In a move aimed at maintaining India’s leadership in the global diamond industry, the Department of Commerce announced the Diamond Imprest Authorization (DIA) Scheme on Tuesday.
The scheme, set to come into effect in April, is designed to revitalize the sector, which has been facing declining exports and job losses. It will offer targeted incentives to exporters while also ensuring the protection of domestic interests.
The DIA Scheme allows for the duty-free import of natural cut and polished diamonds of less than ¼ carat (25 cents), contingent on exporters meeting a value addition requirement of at least 10%, the commerce ministry said in press statement.
Eligibility criteria ensures that only two star export houses and above, with an annual export revenue exceeding $15 million, can avail of these benefits, the ministry said.
A two star export house refers to businesses that export goods worth at least $15 million in a year.
By focusing on value addition, the initiative aligns India with global beneficiation practices seen in diamond-rich nations like Botswana, Namibia, and Angola, where local processing is mandatory.
India, a dominant player in the diamond trade, processes 90% of the world’s diamonds. However, increasing competition from these mining countries, coupled with rising costs and global economic uncertainties, has begun to strain the sector.
The DIA scheme addresses these challenges by providing Indian diamantaires with a level playing field, ensuring they remain competitive without relocating operations abroad.
Industry experts lauded the move. “The DIA scheme has the potential to transform India’s diamond industry by reducing input costs and encouraging innovation in cutting and polishing techniques,” said Vipul Shah, chairman, Gem and Jewellery Export Promotion Council.
“It’s a bold step that not only supports MSME exporters but also sends a clear signal to the world about India’s intent to remain a global leader,” said Shah.
Moreover, the initiative is expected to catalyze job creation across the value chain, from artisans to processing units, providing much-needed relief in a labour-intensive sector.
India exports gems and jewellery to many countries, including the US, Hong Kong, and the UAE.
India's gems and jewellery exports declined in FY24 to a three-year low. This was due to a decrease in demand from key markets like the US and China. According to data from the commerce ministry's Niryat portal, gems and jewellery exports stood at $32.71 billion during FY24, down from $37.96 billion in FY23 and $38.94 billion in FY22.
The Gems and Jewellery Export Promotion Council (GJEPC), a government-backed body, had set an export target of $40 billion in FY24 on the back of higher sales to the UAE.
India imports rough diamonds since it doesn’t produce these commodities in any significant quantity. It exports gems and jewellery, adding value in the process.
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