India has been one of the biggest suppliers of diamonds to the United States for years — and that pipeline is now at risk.
The flow of diamonds from India to the United States dropped significantly after President Trump imposed new duties on imports from the country in April, as part of his global rollout of tariffs.
Note: Figures represent imports for consumption and the duties applied to them.
While the amount of diamonds imported to the U.S. dropped, the duties paid on them stacked up.
On Wednesday, the administration further increased tariffs on imports from India, to 50 percent from 25 percent. Mr. Trump said the increase was punishment for the country’s continued purchase of Russian oil.
India is a dominant force in the global market for cut and polished diamonds, and America is one of its largest buyers. The increase will likely disrupt the international diamond trade and potentially lead to increases in retail prices in the United States.
“I have colleagues who had stuff coming in and missed the boat, and I mean literally the boat by a day, and got these huge tariffs because they were put into effect,” said Steven Grauer, the chairman and security director for the Diamond District Partnership in New York City.
Before Mr. Trump imposed the new tariff, American importers could buy polished diamonds from India duty-free.
Diamond imports from India since July 2024
Note: Figures represent imports for consumption and the duties applied to them.
The polished diamonds imported from India often end up in products like rings and necklaces. The retail price of those products has been fairly stable in recent months, Mr. Grauer said, in part because merchants purchased extra gems before the first tariffs took effect in April.
At some point, however, that stock will run out, and the cost of tariffs will likely be passed on to the consumer, Mr. Grauer suggested.
“I think you will see an uptick, because obviously someone’s got to pay the duty, and the end consumer at the end of the day is the one who ends up paying it, because if I pay it, I have to pass it along,” Mr. Grauer said.
Tariffs have become an increasingly sprawling — and powerful — tool for Mr. Trump’s economic and foreign policy. And it could hurt the world’s largest democracy and a key strategic partner that America has long viewed as a counterweight to China’s growing influence in Asia and elsewhere.