• The US Treasury has extended sanctions to Russian diamond miner Alrosa PJSC, potentially cutting off about 30 per cent of the world’s supply of rough stones.

• Alrosa is the world’s largest diamond mining company, which is also responsible for 90 per cent of Russia’s diamond mining capacity. It is owned one-third by the Russian government. It exports mostly to Belgium, India, and the United Arab Emirates.

• Diamonds are one of Russia’s top 10 non-energy exports by value, with exports in 2021 totalling over $4.5 billion.

Will it impact India?

• Sanctions imposed by the United States and European nations on Russia in the wake of its aggression on Ukraine is likely to have a direct impact on the Indian diamond industry.

• Diamond has been a major component of India-Russia trade.

• Russia’s biggest diamond miner Alrosa supplies about 30 per cent of the rough diamonds globally and is a critical source for India. 

• India imports, cuts and polishes 80-90 per cent of the world’s rough diamonds.

• The Indian diamond industry, which is almost entirely export-oriented, is likely to clock revenues of $24 billion this fiscal, bouncing back to pre-pandemic levels. It was expected to log a compound annual growth rate of 5-7 per cent over the medium term on the back of steady demand and hardening prices before the Russia-Ukraine war began.

• India’s gold & diamond trade contributes about 7 per cent to the GDP and employs over 50 lakh people.

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