Union Budget 2023: The government on Wednesday proposed a cut in import duty on seeds used to make lab-grown diamonds with a view to boosting domestic manufacturing. In her budget speech, Finance Minister Nirmala Sitharaman said that India is a global leader in the cutting and polishing of natural diamonds, contributing about three-fourths of the global turnover by value.
“With the depletion in deposits of natural diamonds, the industry is moving towards Lab Grown Diamonds (LGDs) and it holds huge promise. To seize this opportunity, I propose to reduce basic customs duty on seeds used in their manufacture,” she said. Gem and jewellery exporters had demanded a cut in the import duty.
The industry stated that the conventional source of rough diamonds across the world faces threats of deposit depletion, which also contribute to the exponential increase in the cost of extraction. Industries have thus found lab-grown diamonds to be a profitable alternative. These lab-grown or man-made diamonds are grown inside a lab using cutting-edge technologies under specific parameters. They have a similar physical appearance, chemical composition and optical qualities as natural diamonds.
An LGD is produced using a seed, which is a crucial raw material. “It was a mixed budget for the gems and jewellery industry as the finance minister did acknowledge the potential of the LGDs for exports, and to create employment,” Kama Jewelry fonder and Managing Director Colin Shah said.