Last year, China’s diamond market generated about USD 5.7 billion in revenue, and is expected to grow to USD 7.2 billion by 2030, according to market analysts.
The demand for diamonds has fallen by as much as 50 per cent in China, while wholesale diamond prices have fallen by about 40 per cent over the past two years, creating a major downturn in the global diamond industry especially that of India as it accounted for a third of India’s cut and polished diamond exports.
India’s gems and jewellery exports declined by 23.49 per cent in February at USD 2,422.9 million (Rs 21,085.030 crore) compared to the same month of last year following a continued dip in demand in the US and China, the GJEPC data stated last week.
To boost Indian exports, the GJEPC, the apex body driving India’s export-led growth in the gem and jewellery sector, took part in the Hong Kong International Diamond, Gem & Pearl Show (DGP) early this month.
The India Pavilion featured 71 exhibitors across 116 booths spread across key sections such as Loose Diamonds, Lab Grown Diamonds, Gemstones, and Hall of Fine Diamond, fine Jewellery, and silver Jewellery, the GJEPC said in a press release to PTI, outlining its assessment about the Chinese market, which is crucial to the stability of India’s diamond export market. With Hong Kong being one of India’s key export markets, the event played a crucial role in strengthening trade ties and expanding India’s footprint in the global gem and jewellery market, it said. It said the Chinese diamond market is showing early signs of recovery, bringing cautious optimism to India’s diamond industry.
“The stabilising diamond prices and revival of Chinese demand are positive indicators for the global industry. India’s strong manufacturing base and adaptability position it well to capitalize on this opportunity for long-term growth,” GJEPC Chairman Kirit Bhansali said in the press note.
“After a prolonged slowdown, buyers are accepting current price levels, leading to steady sales. This renewed demand could reshape India’s diamond manufacturing landscape, prompting a shift back towards natural diamonds,” GJEPC Vice Chairman Shaunak Parikh said.
Insights from key industry leaders indicate a gradual resurgence, particularly in the demand for smaller diamonds. While a full-scale revival remains distant, stabilising diamond prices and renewed Chinese interest offer hope for sustained growth, the GJEPC said.
The recent Hong Kong trade shows marked the first positive event in four to five years, according to Ajesh Mehta, Convener of the Diamond Panel at GJEPC.
While Chinese demand has not returned to previous highs, he said that diamond prices have stabilised, and smaller stones are seeing increased movement. “Confidence is slowly returning, especially in diamonds below 10 points and dossier sizes,” Mehta said.
Mehta attributed this shift to evolving consumer preferences in China.
Retailers are now incorporating smaller diamond accents in gold jewellery rather than showcasing diamonds as centrepieces.
However, he believes this trend is temporary. “The Chinese consumer has effectively pressed a reset button. Over time, confidence will likely return for larger stones, such as 30 or 50 points,” Mehta said.
Beyond China, emerging markets like Cambodia, Vietnam, Brazil, and Venezuela are showing increased interest in larger stones. While these regions cannot replace China’s dominance, they are contributing to new pockets of demand, he said.
Devansh Shah, Partner at Venus Jewel, noted an uptick in inquiries at the Hong Kong shows from diverse global markets, including Europe, Australia, the US, and the UAE.
“The Chinese and Far East buyers, known for their quality-conscious approach, prioritized superior products. Round brilliant diamonds saw multiple queries, while larger fancy cuts and 3-carat-plus round brilliants were available on an order-only basis,” he said.
GJEPC said the resurgence of the Chinese diamond market, even if gradual, signals potential growth opportunities for India’s diamond cutting, polishing, and export sectors.
With a strategic approach and market adaptability, India is well-positioned to navigate this evolving landscape and drive sustainable industry growth, it said.
