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Wealthy Russians Surge in Investment-Grade Diamond Purchases Amid Market Uncertainty

Demand for polished diamonds up by 60% as individuals diversify portfolios with gemstones following VAT abolition and growing financial volatility.

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Wealthy Russians are increasingly turning to investment-grade diamonds, with purchases of polished stones rising by 60% last year, according to VTB, the country’s second-largest bank. This surge in demand is attributed to the government’s decision to abolish VAT on diamond purchases, which has made gemstones a more attractive investment option.

Oksana Semenenko, vice president at VTB and head of its private banking division, explained that the rarity and uniqueness of diamonds make them especially appealing during times of rising financial market instability and tighter investment restrictions. Many affluent clients are now incorporating alternative investments, including diamonds, into their portfolios, typically allocating 5-10% of their assets to these tangible assets for diversification.

This shift comes amid increasing sanctions from the G7 and restrictions on Russian currency, which have impacted Russian diamond exports. In response, Alrosa, the state-run diamond mining giant, is turning to alternative markets to sell its goods. The company’s Diamond Exclusive program focuses on polishing its largest and highest-quality diamonds, particularly stones of 3 carats or more, to be sold directly to investors through partnerships with VTB and other financial institutions.

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DiamondBuzz

Russia Tightens Rules On Synthetic Diamond Labelling

Industry’s Most Stringent Measures Aimed At Clearly Distinguishing Lab-Grown Stones From Natural Diamonds

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Russia has introduced new regulations governing the sale and marketing of jewellery containing synthetic diamonds, marking one of the industry’s most stringent measures aimed at clearly distinguishing lab-grown stones from natural diamonds. The rules are set to take effect on 1 September 2026.

The new provisions were adopted under Resolution No. 657 of 30 May 2026 by the Government of the Russian Federation and amend the country’s retail sales regulations for precious metals and gemstones.

Under the revised rules, jewellery containing synthetic stones may continue to reference the corresponding natural mineral, but labels and tags must prominently include the word “synthetic” or its approved abbreviation. However, the use of the word “diamond” and its derivatives in relation to synthetic materials will be prohibited. The regulations also ban the use of colour and quality descriptors typically associated with natural diamonds.

The resolution further prohibits retailers and marketers from using terms such as “precious”, “real”, “genuine”, “natural”, “mined”, “mineral” and “eco-friendly” when describing synthetic stones. In addition, the weight of synthetic stones may only be disclosed in grams rather than carats. The restrictions apply to all forms of consumer-facing information, including product labels and marketing materials.

The measures are intended to protect consumers from misleading sales practices and ensure greater transparency in the marketplace. Russia, the world’s largest producer of natural diamonds by volume, said the rules are designed to safeguard consumers and support fair competition between natural and synthetic diamond products.

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JewelBuzz is Asia’s First Digital Jewellery Media & India’s No.1 B2B Jewellery Magazine, published by AM Media House. Since 2016, we’ve been the trusted source for jewellery news, market trends, trade insights, exhibitions, podcasts, and brand stories, connecting jewellers, retailers, and industry professionals worldwide.

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