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Indian exports shielded from G7 ban on Russian diamonds
The local industry has been worried that the ban—a part of international measures against Russia for its invasion of Ukraine—could have major repercussions for exports of the stones, with the US being India’s biggest market A decision by the Group of Seven (G7) nations to ban imports of polished diamonds made from Russian rough stones from early next year will not hurt Indian diamantaires, a senior government official said on Friday. The local industry has been worried that the ban—a part of international measures against Russia for its invasion of Ukraine—could have major repercussions for exports of the stones, with the US being India’s biggest market. India, which cuts 14 out of 15 of the world’s rough diamonds, according to government data, does not import the stones directly from Russia but sources them from hubs like Antwerp and Dubai. “There should be control over rough diamonds coming from Russia, but as long as diamonds are processed in India, there should not be further checks (or double checks) as we can maintain tracking of rough diamonds," the official said, requesting anonymity. “Rough Russian diamonds coming from Antwerp and other places like Dubai can be used for our exports. This shouldn’t disturb the sanctions on Russian diamonds, and we should be able to export our processed diamonds," the official added. A commerce ministry spokesperson didn’t immediately respond to emailed queries. The G7 has announced a direct ban on Russian diamonds starting 1 January, which is to be followed by phased-in restrictions on indirect imports of Russian diamonds, or those processed by third countries, from March. In effect, the impact on India’s diamond industry will kick in from March. But Indian diamantaires were left guessing on which sizes of diamond polished in India would be impacted. As per the G7 decision, all Russian diamonds of 1 carat or higher coming into G7 territories will not be accepted. From September, this limit will be reduced to 0.5 carat, along with the launch of a traceability system to track diamond imports. With a 30% share of the global market, Russia is the world’s biggest producer of rough diamonds by volume. The US, a key G7 member, accounted for a provisional 36% share of total diamond exports from India of $22.04 billion in FY23, ahead of Hong Kong at 25.16%. Japan accounted for a mere 1.18% of the exports from India, worth $260 million. Source - Mint
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