NEW DELHI: January 22: In a bid to strengthen India’s diamond sector and enhance its global competitiveness, the central m government has announced the launch of the Diamond Imprest Authorization (DIA) Scheme, set to take effect from April 1. This initiative allows duty-free imports of natural, cut, and polished diamonds, aiming to promote value addition and stimulate exports, according to the Department of Commerce.

Under the scheme, natural diamonds that are cut, polished, and weigh less than one-fourth carat (25 cents) can be imported without paying duties. In return, exporters are required to meet an export obligation with at least 10% value addition. The government has clarified that only diamond exporters with a “Two Star Export House” status or higher, and annual exports of at least USD15 million, will qualify for this scheme.

The introduction of the DIA Scheme draws inspiration from “beneficiation” policies implemented in diamond-rich nations like Botswana, Namibia, and Angola, where manufacturers are required to set up facilities for cutting and polishing diamonds, ensuring a minimum percentage of value addition. India’s scheme is crafted to preserve its status as a global leader across the diamond industry's entire value chain.

“The scheme is focussed on generating a level playing field for Indian diamond exporters, specifically MSMEs, enabling them to compete with larger players effectively, said the  Ministry of Commerce & Industry. Furthermore, the scheme is expected to open up more employment opportunities, particularly for diamond assorters and workers involved in processing semi-finished diamonds in factories. By supporting Indian exporters, the initiative also aims to safeguard the domestic diamond processing sector and protect jobs tied to the industry.

India’s diamond industry has been struggling with a sharp decline in exports and significant job losses among workers. The government expects the DIA Scheme to reverse this downward trend and revitalize the sector. Recent data from the Gems and Jewellery Export Promotion Council (GJEPC) revealed that India’s total gross exports of gems and jewellery in December 2024 dropped to USD1,967.98 million, marking a 10.29% decline compared to the same month the previous year.

The GJEPC attributed the downturn to ongoing economic uncertainty, which has prompted global buyers to prioritize gold as a safer investment rather than spending on luxury items like diamonds.