Govt unveils Diamond Imprest Scheme to support exports and local industry

In a bid to sustain its leadership in the global diamond industry, the Department of Commerce announced the Diamond Imprest Authorization (DIA) Scheme on Tuesday. Set to roll out in April, the initiative aims to revitalize a sector grappling with declining exports and job losses.

The DIA Scheme will offer targeted incentives to qualified exporters while safeguarding domestic interests. Only two-star export houses and above, with annual export revenue exceeding $15 million, are eligible for the scheme, according to the Commerce Ministry. A two-star export house is defined as a business exporting goods worth at least $15 million annually.

A key feature of the scheme is the duty-free import of natural cut and polished diamonds under ¼ carat (25 cents). However, exporters must meet a value addition requirement of at least 10% to avail these benefits. This emphasis on value addition mirrors global practices in diamond-rich nations like Botswana, Namibia, and Angola, where local beneficiation is mandatory.

India processes 90% of the world’s diamonds and has long been a dominant player in the diamond trade. However, rising competition from mining nations, coupled with escalating costs and global economic uncertainties, has put significant pressure on the industry. In FY24, India’s gems and jewellery exports dropped to a three-year low of $32.71 billion, down from $37.96 billion in FY23 and $38.94 billion in FY22, as per data from the Commerce Ministry’s Niryat portal.

The DIA Scheme is seen as a strategic move to address these challenges. By reducing input costs and promoting advanced cutting and polishing techniques, the initiative seeks to retain India’s competitiveness and prevent diamantaires from relocating operations abroad.

“The DIA Scheme is a game-changer,” said Vipul Shah, Chairman of the Gem and Jewellery Export Promotion Council. “It not only lowers costs for exporters but also positions India to innovate and maintain its edge in the global diamond market. This is a bold step towards ensuring the sector’s long-term sustainability.”

Beyond exports, the scheme is expected to generate employment across the diamond value chain, from artisans to processing units, in this labor-intensive sector.

India remains a key exporter of gems and jewellery to markets like the US, Hong Kong, and the UAE. With the DIA Scheme, the government aims to stabilize the sector, drive sustainable growth, and reaffirm India’s status as a global diamond hub.