The demand for lab-grown diamonds (LGDs) is growing with firms capitalising on the rising choice of customers for a less expensive, environmentally pleasant choice. The affordability and moral manufacture of lab-grown diamonds place them as a superb different to pure diamonds, the sourcing of which has usually been criticised as unethical, because it has been linked to unfair labour practices and might hurt the surroundings. “As we speak lab-grown diamonds have gotten very talked-about; they provide the similar attraction as pure and might final very lengthy. On the similar time, they’re much cheaper than pure diamonds,” says Saiyam Prem Mehra, Chairman, All India Gem and Jewelry Home Council.
Throughout his 2023 go to to the US, Prime Minister Narendra Modi gifted a 7.5 carat eco-friendly lab-grown diamond to the then first woman, Jill Biden. The diamond was manufactured in a manufacturing facility in Surat utilizing renewable power sources like photo voltaic and wind energy. This illustrates the growing recognition and acceptance of lab-grown diamonds, also referred to as artificial diamonds, all over the world.
Darayus Mehta, Co-founder and Director of True Diamond, which was based in 2023, says that though they began solely a yr in the past, they’ve skilled outstanding development, attaining a 5X enhance in gross sales from the primary month to December 2024. “This speedy development displays the growing acceptance of LGDs by at this time’s customers, particularly these searching for inexpensive, sustainable luxurious. Our main buyer base consists of people aged 35-45, predominantly millennials who’re progressive, impartial, digitally savvy ladies and are aware about sustainability and innovation in jewelry,” he says.
The lab-grown diamond jewelry market in India was valued at $264.5 million in 2022. As per the estimates by funding promotion company INDEXTb, lab-grown diamond jewelry gross sales will rise at a CAGR of 14.8% over the subsequent 10 years, and the whole market measurement will enhance to $1,192.3 million by 2033, up from $299.9 million in 2023. A vibrant future definitely awaits LGDs!However will the recognition of LGDs take the flicker away from pure diamonds?
Darayus Mehta, Co-founder and Director of True Diamond, says that though they began solely two years in the past, they’ve skilled outstanding development, attaining a 5X enhance in gross sales from the primary month to December 2024.
Within the tough
At the moment, pure diamond gamers within the nation are dealing with a double whammy—dwindling gross sales and growing recognition of LGDs. Let the figures do the speaking. Based on the newest GJEPC report, India’s export of lower & polished diamonds dropped by 18.25% in April-December 2024 to $9.75 billion from $11.93 billion throughout the identical interval within the earlier yr. Throughout this era, imports additionally declined by 34.09%—from $1.49 billion in April-December 2023 to $0.98 billion in April-December 2024.
India’s diamond processing business, which processes round 90% of the world’s tough diamonds by quantity, has seen a 24.5% drop in tough diamond imports—from $18.5 billion in FY22 to $14 billion in FY24, in line with a latest GTRI report. The truth is, India’s general diamond commerce (exports + imports) has dipped by 22% year-on-year in FY24 as a result of challenges of decreased demand in main export locations and supply-side points, reminiscent of G7 sanctions,” Govindu says, citing knowledge from the Ministry of Commerce and Business.
Praveen Govindu, Accomplice, Deloitte India, attributes the decline to low demand within the world market, citing the report by GTRI. He says that in key markets, just like the US, China, and Europe, demand has gone down resulting from financial uncertainty, inflation, and geopolitical tensions, resulting in decreased shopper spending on luxurious items, together with diamonds. “In China, the diamond demand has plummeted by greater than 50% over the previous two years, however the consumption of lab-grown diamonds has surged, particularly within the vogue jewelry and low-end engagement ring segments,” he provides.
ET On-lineHighway in the direction of revival
At the same time as lab-grown diamonds achieve recognition in India and all over the world, Bengaluru-based Debolina Biswas prefers pure diamonds, as she feels that the previous lack worth. “I choose shopping for (for myself and others) fantastic jewelry that may be worn extra recurrently, relatively than storing it away in a financial institution locker and solely taking it out on events. I’m not a fan of lab-grown diamonds just because I really feel they’re not value it. Diamonds (pure) have some type of re-sale worth,” she says.
Shoppers like Debolina give hope to pure diamond gamers within the nation. Regardless of the declining numbers, they proceed to be optimistic concerning the future and are trying ahead to its rising demand.
In 2024, India has grown to develop into the second-largest pure diamond jewelry market on the earth, overtaking China, in line with Richa Singh, Managing Director, India and the Center East, Pure Diamond Council, who cites a latest De Beers Diamond Perception Report. “We’re second solely to the US, and this development wouldn’t have been doable with no rising demand, want and adoption for diamonds from customers. We noticed 64 million visits to our web site final yr, displaying that customers are interested by pure diamonds and need to know extra concerning the class.”
India is predicted to have 100 million further customers who can afford pure diamonds by 2030, in line with De Beers knowledge. “With expert artisans and their bespoke designs, India continues to be a key marketplace for pure diamonds,” she provides.
She says that the rarity of pure diamonds is what is going to maintain the business thriving, as diamond restoration has dropped by 30% since 2005 and no vital new diamond deposits have been found in latest instances.
“Pure diamonds are in all probability one of many oldest items of the earth’s historical past one can maintain of their hand. They’re older than dinosaurs and even among the stars within the sky. Each bit is exclusive and one among a sort, like a fingerprint. There isn’t any different luxurious product on the earth that may be worn and loved every single day, handed down generations, have added reminiscences and feelings, and nonetheless look identical to it did on the day it was first bought. They’re finite in provide and getting rarer by the day, which lends them an inherent worth,” she says.
Lab-grown diamonds, however, are mass-made replicas of one another, produced over a few weeks. They are often made on a vast scale, resulting in the economics of demand and provide. In consequence, the costs of lab-grown diamonds, in some instances, have dropped by as a lot as 83% between 2015 and 2024, she says. “They (LGDs) are at the moment getting used for industrial utilization, in medical devices, and within the vogue business, however we consider they might not be a alternative for a billion-year-old heirloom,” she says.
Richa Singh, Managing Director, India and the Center East, Pure Diamond Council says that the rarity of pure diamonds is what is going to maintain the business thriving.
She provides that the necessity of the hour is to dispel myths, misconceptions and any deceptive claims which create ambiguity and confusion for customers. “Shoppers deserve transparency, and we’re very joyful that even the federal government has recognised the identical. The latest diamond terminology pointers proposed by the Central Client Safety Authority (CCPA), one thing we now have been working carefully with the GJEPC on for the final 1.5 years, is a giant step on this route. It is going to supply clear language to distinguish between pure diamonds and lab-grown diamonds, eradicating ambiguity and enabling customers to make an knowledgeable determination,” she says.
The CCPA proposed express labelling and certification of all diamonds. Based on the proposed pointers, diamonds ought to have specs of their origin and manufacturing technique, and phrases like “pure” or “real” shouldn’t be used for lab-grown diamonds. The CCPA is about to launch a extra detailed and strong framework for the diamond business.
In November of final yr, through the festive and wedding ceremony season, the Pure Diamond Council additionally got here up with a marketing campaign—‘Ensure that it’s pure diamond’. The marketing campaign aimed to spotlight the uncommon and distinctive qualities of pure diamonds.
In defence of pure diamonds, Varghese Alukka, MD of Jos Alukkas Group, asserts that (pure) diamonds have at all times been sought for his or her rarity, uniqueness and exclusivity, qualities that LGD doesn’t supply. “The general emotional and nostalgic worth of diamonds as a class is lacking in LGD and offers LGD a way of sporting a faux. With the present pattern at which LGD costs are dropping, it could by no means be an funding or have any resale worth, making it simply one other stone,” he says.
He acknowledges the significance of teaching prospects concerning the distinction and reconnecting customers with the real emotion of pure diamonds by means of distinctive and genuine digital narratives.
In August, De Beers Group and Tanishq introduced a collaboration to spice up gross sales of pure diamonds. The collaboration entails intensive shopper outreach and communication about pure diamonds and diamond authenticity by means of Tanishq’s retail employees, together with a 360-degree advertising and marketing marketing campaign round it. Tanishq already makes use of De Beers’ proprietary diamond verification expertise to offer authenticity assurance of its merchandise.
Amit Pratihari, MD, De Beers India, says that in 2005, India’s home diamond jewelry market accounted for simply 2% of worldwide consumption. By 2024, it has grown to 11%, making India the second-largest marketplace for diamond jewelry on the earth.
He provides that probably the most vital surge in demand has been noticed within the final couple of years, pushed by growing shopper affluence, evolving preferences, and better consciousness of pure diamonds’ enduring worth. The market’s unprecedented growth has created huge alternatives, partaking over 500,000 jewellers throughout the nation and reshaping the panorama of the diamond business in India.
iStockSpecialists are of the view that in a market like India, the place customers search for each worth and value whereas making purchases, there’s ample house for each pure and LGDs gamers to thrive.
He says the latest dip in costs is a short lived section, pushed by short-term demand-supply dynamics, and this correction presents a possibility to make pure diamonds extra accessible and aspirational to a brand new era of customers, significantly younger, globally- influenced patrons who search genuine and significant jewelry.
On condition that diamond acquisition charges in India are nonetheless under these in mature markets just like the US, Pratihari believes that there’s vital potential for additional development within the pure diamond jewelry market in India. India will emerge as one of many main diamond jewelry markets on the earth.
The general diamond market in India is predicted to achieve a projected income of $4 billion by 2030 from $3.3 billion in 2024, as per Grand View Analysis.
Specialists are of the view that in a market like India, the place customers search for each worth and value whereas making purchases, there’s ample house for each pure and LGDs gamers to thrive. Saiyam Prem Mehra, Chairman, All India Gem and Jewelry Home Council (GJC), says that many pure diamond gamers themselves are diversifying and opening branches of LGDs. “In case you see the highest 10 diamond gamers, they’ve their different members of the family who’re manufacturing and opening lab-grown shops. It’s a want of the period. If you’re within the diamond business, some a part of it needs to be lab-grown,” he says.
Sooner or later, he says, there can be a market and crowd for each sorts of diamonds. “I don’t assume that they must be categorized and downgraded in a manner the place the pure diamonds have an higher hand and LGDs have a decrease hand. In case you purchase from the best retail retailer, it can have the best resale worth. LGDs are right here to remain, and its future is getting very profitable as we see increasingly more gamers coming into this section,” he says.
