A new US tariff under Section 301 is adding pressure on India’s gems and jewellery exporters, with the sector facing a 10% additional duty on shipments to the American market. The move comes under a forced-labour regime and raises fresh concerns for an export industry that depends heavily on overseas demand.
The tariff weakens part of India’s competitive advantage against countries such as China and Vietnam, where relative tariff differences can influence sourcing decisions. However, that benefit is also limited because rival diamond trading centres like Belgium continue to enjoy duty-free access, making it harder for Indian exporters to rely on pricing alone.
For Indian companies, the immediate challenge is likely to be margin pressure and tougher negotiations with US buyers. Higher import costs can affect order flows, especially in a business where price sensitivity, delivery commitments and global competition play a major role.
The development adds another layer of uncertainty for India’s gems and jewellery trade at a time when exporters are already navigating shifting trade rules and competition from multiple hubs. With the US remaining a crucial market, the industry now faces the task of adjusting to a more difficult tariff environment.
