Key Points
- CBIC requires declaration of lab-grown diamond production methods from December 1.
- The global market for lab-grown diamonds is expected to grow from $1 billion in 2020 to $5 billion by 2025.
- Exports of lab-grown diamonds fell by 16.5% in 2023.
- Three production methods to declare are Chemical Vapour Deposition, High Pressure-High Temperature, and others.
- The gems and jewellery sector contributes about 9% to India’s total merchandise exports.
Looma News
The Central Board of Indirect Taxes & Customs (CBIC) has announced that from December 1, anyone exporting or importing lab-grown diamonds will need to state how they were made. This move aims to speed up the processing and inspection of shipments, making it easier to trade in the growing lab-grown diamond market.
The global market for lab-grown diamonds was worth $1 billion in 2020 and is set to reach $5 billion by 2025, with predictions to exceed $15 billion by 2035. According to the CBIC, the requirement to declare production methods is part of the regulations introduced in 2018 and 2019.
Data from the Gem and Jewellery Export Promotion Council (GJEPC) shows that lab-grown diamond exports surged by over 100% in 2021-22, followed by a 28% increase in 2022-23. However, in 2023, exports dropped by 16.5%, falling from $1,680 million in 2022-23 to $1,402 million.
Traders have pointed out that even though the overall export value has gone down, the quantity in carats has gone up. This decline in value is due to price adjustments per carat because of market competition. The CBIC’s announcement highlights that providing detailed production methods will improve assessment quality and speed up cargo clearance.
The CBIC has specified three production methods that need to be declared: Chemical Vapour Deposition, High Pressure-High Temperature, and others. A previous circular from 2020 encouraged importers to voluntarily give more detailed descriptions of imported goods to make assessments smoother.
Not enough information from current importers and exporters has made it hard to create effective policies and improve assessment efficiency. The CBIC believes that requiring detailed production method declarations will help reduce questions and speed up clearance processes.
The gems and jewellery sector is vital to the Indian economy, contributing about 9% to the country’s total merchandise exports. Lab-grown diamonds are also used in areas beyond jewellery, like in computer chips, satellites, and 5G networks, due to their ability to perform in extreme conditions.
