The Gem & Jewellery Export Promotion Council (GJEPC) has expressed concern over the United States' transition to a new Section 301 tariff regime, effective 24 July 2026, under which the additional tariff on Indian gem and jewellery exports remains unchanged at 10%.

The revised tariff framework follows investigations conducted by the Office of the United States Trade Representative (USTR) into the implementation and enforcement of prohibitions on imports produced with forced labour across 60 economies. India has been placed in the lower 10% tariff band after adopting a prohibition on forced labour imports, while competing manufacturing and trading hubs including China, Hong Kong, Thailand, Türkiye, the UAE, Israel and Vietnam are now subject to a 12.5% additional tariff.

According to GJEPC, the lower tariff band gives Indian exporters a 2.5 percentage-point tariff advantage over these competing markets. However, the Council noted that significant challenges remain, particularly for natural diamonds and jewellery exports to the U.S.

Shri Kirit Bhansali, Chairman, GJEPC, said, "At the outset, we categorically reject any implication that India’s gem and jewellery sector is linked to forced labour. Repeated studies have been commissioned that demonstrates the industry’s long-standing commitment to responsible sourcing, worker welfare, and ethical business practices. We also welcome the Government of India’s recent amendment to the Foreign Trade Policy that bars the import of goods produced, wholly or partly, with forced labour — an important step that reinforces India’s commitment to human rights and aligns our trade rules with internationally accepted labour standards.

“So imposing of 10% U.S. tariff under the new Section 301 regime, which is not at all justified, remains a challenge for India's gem and jewellery exports, particularly as key competing trading centres in diamond continue to enjoy duty-free access for natural diamonds. While India's placement in the lower tariff band offers some relative competitiveness in terms of jewellery, bridging the remaining tariff gap through an early India–U.S. Bilateral Trade Agreement and securing tariff relief for natural diamonds and coloured gemstones as provided to countries like EU, Malaysia remain our key priorities.”

GJEPC highlighted that jewellery exports to the U.S. will continue to attract the existing Most Favoured Nation (MFN) duty of 5.5–6%, in addition to the 10% Section 301 tariff, resulting in an effective import duty of approximately 15.5–16%. Lab-grown diamonds and synthetic stones also remain subject to the additional 10% tariff. Meanwhile, natural diamonds imported through the European Union continue to benefit from a 0% additional tariff, creating a competitive disadvantage for Indian exporters.

The Council said it is engaging with the Government of India to pursue an early India–U.S. Bilateral Trade Agreement (BTA) and has reiterated that natural diamonds and coloured gemstones should be considered for exemption from the additional tariff under Annex III.