From Mine to Market: How Trump’s Tariffs Chip Away at Gems

Right now, the gemstone world is under serious pressure. A ruby glowing from the mines of Myanmar, a velvety sapphire drawn from Madagascar’s soil, or a radiant emerald from Colombia’s emerald belt. These treasures pass through the expert hands of cutters, patient polishers, and visionary designers before being showcased. Yet in 2025, the sparkle now comes with a sharper price tag, thanks to sweeping U.S. tariffs. 

At the dawn of the year, the U.S. introduced a flat 10% duty on most imports. For the gemstone and jewelry trade, however, the increases escalated quickly. By April, tariffs on cut and polished stones had already climbed into the 27-37.5% bracket, depending on the product classification. Then came the most dramatic move, in late August, imports of Indian gems and jewelry, the lifeblood of the global cutting and polishing industry, were hit with a 50% tariff, a staggering rise from the negligible 3% duties of previous years.

The tariff tsunami isn’t just an issue for India, it’s a global ripple effect. The gemstone trade is deeply interconnected: diamonds are mined in Africa and Russia and then are shipped to India for polishing, rubies originate in Myanmar and are often perfected in Thailand, sapphires hail from Sri Lanka, Madagascar, and Australia, while emeralds trace their roots to Colombia, Brazil, and Zambia. When a tariff messes up one part of the system, everyone feels it, from miners and manufacturers to wholesalers and retailers. 

Buyers will notice these changes right away. Expect higher prices for natural tones as margins tighten. The breadth of designs is shrinking too, since many retailers are cutting back or limiting selection to manage costs. At the same time, alternatives such as lab-grown gems, semi-precious stones, and recycled jewelry are gaining traction. While these too carry tariffs, they are generally lower than those on natural diamonds and high-value gemstones. For example, lab-grown diamonds and synthetic stones now fall in the 27–34% range, semi-precious stones at about 27%, and imitation jewelry anywhere from 27% to 38%. Even pearls are taxed at around 27%. The rates are still significant, but for many buyers, these options provide a more affordable way to enjoy beauty without the steep costs tied to natural gems.

For an industry that once enjoyed low or zero import duties, India’s gems and jewelry sector is now facing one of its toughest trials. The U.S. absorbs about 30% of its exports, roughly $10 billion yearly, and the sudden jump to a 50% tariff has rattled the sector, with forecasts suggesting exports could plunge by as much as 70%. Smaller exporters had shipments before the deadline, whereas larger enterprises contemplated relocating to countries with lower tariffs, such as the UAE or Mexico. The Indian government is providing a ₹25,000 crore assistance package and urging exporters to explore diversification into alternative markets, although experts caution about possible job and profit losses.