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Tariff hike to cut revenues of diamond polishers 28-30% this fiscal: CRISIL RATINGS

Reduction in debt to cushion profitability impact; credit profiles face challenges

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India’s natural diamond polishing industry faces a steep 28-30% fall in revenues to ~$12.50 billion this fiscal, compared with $16 billion last fiscal, after the imposition of 50% tariffs (25% reciprocal plus 25% penalty) by the US. The blow will follow a ~40% degrowth over the past three fiscals because of a fall in both prices and sales volume of natural diamonds as demand in the US and China dropped, and competition from lab-grown diamonds rose.

The 50% tariffs, effective this week, makes exports to the US tough for two reasons: one, the industry’s low margins make absorption of the incremental levy very difficult and two, declining demand means passing on the incremental burden to consumers will not be easy. The consequent reduced operating leverage could erode the operating margin of diamond polishers by 50-100 basis points and pressurise their credit profiles.

Our analysis of 43 diamond polishers, accounting for nearly a fourth of the industry’s revenues, indicates as much.

The Indian polished diamond industry derives 80% of its revenues from exports while the US is a key market for India and accounted for as much as 35% of its exports. Sales had begun getting impacted after a 10% tariff was imposed in April 2025. Hence, the share of the US in India’s polished natural diamonds slid 1100 basis points in the first four months of this fiscal to 24%.

But in a proactive move, diamond polishers had cranked up production in July and August to meet the anticipated festival demand in the US. Not surprisingly, exports surged 18% in July on-year And competition from lab-grown diamonds in markets such as the US will continue to dent revenues, with the variety having already captured ~60% of the market share by volume. Subdued Chinese demand adds to these woes.

Rahul Gua

Says Rahul Guha, Senior Director, Crisil Ratings, “The upshot is that revenues for the domestic industry, which polishes ~95% of all diamonds produced in the world, is set to drop to its lowest since 2007. To be sure, consumption in India has been increasing sequentially over the years, but the incremental demand doesn’t have the heft to fully offset the losses in the US and China. Additionally, while the UAE has emerged as a dominant hub for India’s exports with its share doubling to ~20%, on year, the risks of a substantial downturn in revenues are high.”

The industry’s ability to navigate the market dynamics, including tariffs, is crucial to its future. Diamond polishers can take three steps: increase domestic sales; push sales in alternative geographies; and set up polishing facilities in trading hubs as rerouting via low-tariff nations is not an option. Even if retailers explore alternative sourcing options in lower-tariff countries such as the UAE or Belgium, a significant portion of the diamonds would still be polished in India and thus subject to higher tariff.

And given the falling demand, US retailers are unlikely to absorb the tariff cost. Hence, operating margins of diamond polishers would decline to 3.5-4.0% after dropping 100 bps in the past three fiscals from a peak of 5.5% in fiscal 2023.

Diamond polishers are expected to keep a lean inventory to control debt. Miners have cut production to limit the fall in prices, in line with subdued demand. Timely collection from customers abroad will be monitorable amid slowing demand. Debt levels of diamond polishers should reduce over the medium term. In the road ahead, demand for natural diamonds in key markets will need close monitoring, given the tariff landscape and geopolitical uncertainties.

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National News

Jaipur Customs launches single all-India electronic bond for importers, exporters

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Jaipur Customs has issued Public Notice No. 15/2025 announcing the rollout of Ekal Anubandh – the Single All-India Multi-Purpose Electronic Bond (SEB) and Electronic Bank Guarantee, in line with CBIC Circular No. 04/2025-Cus dated 17 February 2025.

The new system replaces multiple port-wise bonds with a single electronic bond applicable across India. Importers and exporters will now be able to submit one unified bond through ICEGATE, with provisions for electronic stamp duty payment, digital signatures, and online linking of electronic bank guarantees.

The initiative aims to cut costs, save time, and simplify compliance by eliminating repetitive paperwork and administrative delays. According to Jaipur Customs, the phased rollout will be supported by advisories issued by DG Systems, and user feedback will be factored into implementation.

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Mumbai’s SEEPZ-SEZ launches postal export facility with new FPO extension

Exporters in the Mumbai SEEPZ Special Economic Zone (SEZ) can now use postal channels for international shipments following the establishment of a Foreign Post Office (FPO) extension within SEEPZ.

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The move, notified through Public Notice No. 9/2025 by the Development Commissioner’s office, comes in response to long-standing requests from trade stakeholders. The new facility allows units to file shipping bills online via the SEZ-Online system and complete customs clearance directly at the FPO extension.

As per the notification, parcels will be cleared primarily through examination of marks and numbers, minimizing delays. Once assessed and endorsed by customs, the parcels will be booked by India Post, which will provide tracking details. The process ensures streamlined handling of e-commerce exports while retaining safeguards such as customs oversight and proof of export submission.

The introduction of this facility is expected to give a major fillip to small-value and e-commerce exports from SEEPZ, making global market access quicker and more cost-efficient for exporters, especially MSMEs.

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Senco Gold & Diamonds unveils Ganesh Chaturthi New Designs & Offers to celebrate the festival of birthday of Lord Ganesha

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Mumbai, August 2025: Senco Gold & Diamonds is a leading pan-India jewellery retailer with a legacy of more than eighty-five years and the largest jewellery retail player in Eastern India based on number of showrooms with a whooping count of 186+, introduces Ganesh Chaturthi New Designs and offers to celebrate the festival of birthday of Lord Ganesha, the Lord of knowledge, wisdom, prosperity and good fortune. The festival is also known as Vinayak Chaturthi or Vinayak Chavithi.

The ten-day-long festival is a time of devotion and cultural splendour that brings people together.  It is believed that devotees who pray to Lord Ganesha on this auspicious day can fulfil their wishes and are bestowed with good luck and prosperity.

This Ganesh Chathurthi pays homage to the divine aura with gold and diamond jewellery pieces that will not only heighten your whole look but also symbolise prosperity, where customers can explore a wide range of new designs of Gold, Platinum & Diamond jewellery. The Ganesh Chaturthi collection celebrates tradition with a modern touch.

Commenting on this, Mr. Suvankar Sen (MD & CEO, Senco Gold & Diamonds) said, “Senco Gold & Diamonds is known for its exquisite jewellery collections, which are handcrafted with precision and devotion to detail. The brand’s jewellery is inspired by Indian culture and heritage, and it offers a wide variety of designs and styles to choose from, including traditional, modern, and contemporary. The Ganesh Chaturthi festival holds tremendous significance for devotees across Inia and to celebrate that we have introduced fantastic offers of Rs 100 off per gram on gold rate, upto 35% off on making charges in gold jewellery, upto 10% off on diamond value and upto 25% off on making charges of diamond jewellery, upto 10% off on making charges of silver items, and 0% deduction on old gold jewellery exchange. Special discounts in Sennes (Leather) of upto 15% on diamond value (lab-grown diamond jewellery), and upto 15% discount in the MRP of Leather Bags”.

Commenting on this Mrs. Joita Sen, (Director and Head of Marketing & Design, Senco Gold & Diamonds), said, “August is a month of festivities across India, with Rajasthan, Harryana and Bihar celebrating Teej and Maharashtra observing Ganesh Chaturthi. To celebrate the birthday of Lord Ganesha this year, we have launched new pendant designs crafted in gold and diamonds, each such pendant is designed to be lightweight, sleek, and timeless. The jewellery pieces embody reverence for Lord Ganesha while reflecting contemporary elegance, making them perfect symbols of devotion that fit seamlessly into today’s lifestyle”.

Senco Gold & Diamonds offers extensive jewellery collection, including gold, diamond, silver, platinum, as well as precious and semi-precious stones under brands such as Everlite, focused on lightweight jewellery; Gossip, the silver and costume jewellery brand; and D’Signia, which offers a premium jewellery retail shopping experience to customers. Senco Gold & Diamonds also has an Aham collection of jewellery catering to men and a Vivaha collection, which is a premium designer wedding jewellery range. The Ganesh Chaturthi Offers will be available from August 26-31st, 2025, at all Senco Gold & Diamonds showrooms and online channels

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