Lab-Grown Diamond Exports to Rise 7-9% in FY25: Report

Mumbai, May 6 (PTI) Exports of lab-grown diamonds are expected to rise by 7-9 per cent to USD 1,500-1,530 million in 2024-25 as demand for naturally mined diamonds remains sluggish, a report by CareEdge Advisory said on Monday.

Both domestic consumption and exports of man-made diamonds are expected to increase this fiscal due to their low cost, the report said.

"The LGD (lab-grown diamonds) exports are expected to witness a revival with expected growth of 7-9 per cent to reach USD 1,500-1,530 million in FY25. Faced with ongoing geopolitical and economic disruptions globally, the gems and jewellery industry is relying on the rapidly growing LGD market to mitigate the effects of low demand for natural diamonds," CareEdge Analytics and Advisory Director Tanvi Shah said.

LGD exports have been declining in recent times, and have seen around 16.5 per cent year-on-year decline in FY24, mainly on account of declining prices even though the volumes grew, the report stated.

Nevertheless, the depreciating rupee is likely to act as a cushion for the industry, the report noted.

Going forward the demand for LGD is expected to revive in FY25, as demand for naturally mined diamonds may remain sluggish, the report stated.

This is attributed to its price point, environmental sustainability, and intensified competition from India against other leading LGD-producing nations, it added.

India produces over three million lab-grown diamonds a year and accounts for 15 per cent of the global production and at present, the country is the second-largest producer of lab-grown diamonds, trailing behind China, the report stated.

Other than China and India, countries like the US, Singapore and Russia are also leading manufacturers of lab-grown diamonds.

In 2022, the market for lab-grown diamond jewellery in India was valued at USD 264.5 million and the expected value of the domestic lab-grown diamond market is USD 300 million, it said.

The depreciating rupee is likely to act as a cushion for this export-dependent industry and good quality lab-grown diamonds with qualified certification, produced from the developed equipment and process parameters, will attract more foreign consumers, thereby, reviving the exports.

CareEdge Analytics report stated that the declining price of LGD during recent times has resulted in India's exports of LGD to key export destinations.

Exports of LGD have recorded a decline of 16.5 per cent from USD 1,680.22 million in FY23 to USD 1,402.30 million in FY24, it added.