Why Surat's gems are losing their shine

India Today

15-07-2025

(NOTE: This article was originally published in the India Today issue dated July 21, 2025)Joblessness as an occupational hazard? Yes, and it can be fatal, pretty frequently it seems, for those who work the machines in Surat's diamond industry these days. Last July, Sagar Makwana (21), a polisher, died by suicide after losing his job. Come September, thirtysomething Nikunj Tank went the same way, after a spell of deep depression. He left behind two children and a wife. May this year saw the death of Kapil Nimavat, 45, another jobless diamond worker with two schoolgoing children. The Diamond Workers' Union of Gujarat (DWUG) cites over 100 deaths in the past three years—55 suicides in the past year alone.advertisementHow did we get here? It's a full-blown crisis in the diamond industry. Natural diamond sales saw a severe slump after 2022. Lab Grown Diamonds (LGDs)—70 per cent cheaper—got more popular. Now the global markets are sitting on an unprecedented glut of natural diamonds following a 25-30 per cent wholesale price correction. Over the past three years, manufacturers have had to significantly reduce their output.
In times of such economic distress, the pain primarily flows downward: in this case, the 800,000 diamond artisans of Surat, often migrants from Saurashtra and elsewhere, who form a bulk of the nearly 1.2 million-strong workforce across Gujarat, Rajasthan and Maharashtra. Possibly for the first time in the history of the five-decade-old diamond polishing industry in Surat, 500 workers went on a two-day strike in March, demanding a 30 per cent increase in wages.
In May, the Gujarat government announced an aid package for the industry, the first admission that it is indeed in trouble. The children of certified diamond polishers would get Rs 13,500 school fees, besides power and interest subsidies for small units. But Bhavesh Tank, vice president, DWUG, calls it futile. 'Most companies employ artisans on an informal basis, so proving you are a bona fide employee will be next to impossible,' he says. The fees package practically leaves out younger, unmarried polishers—it assumes they have no dependants. 'Unmarried polishers have younger siblings and old parents as dependants,' says Tank. Their aid coming through depends on proving they have schoolgoing dependant siblings. 'Also, the incentives for small units will not trickle down to the worst-affected artisans as the industry understanding is to reduce the supply of diamonds. They will absorb the government benefits but not increase hours or wages.'As artisans fail to make ends meet, at least a fourth of the trained workforce is believed to have returned to their villages in Saurashtra's Amreli and Bhavnagar districts. Earlier water-starved, the availability of Narmada water has revived farming there. But, says Tank, 'for marginal farmers, agriculture remains risky due to climate threats and volatility in market prices of produce'. What's a side hustle for them? Gig work in diamond polishing. Shashikant Shah, chairman, LGD Council of India, says almost every second village in these districts has a dozen-odd 'ghantis' (diamond polishing wheels). By engaging workers there, 'diamantaires are trying to reduce cost of production while retaining a trained workforce,' he concedes.advertisementWHY SELLERS GO NATURALThough almost every exporter and trader now deals with LGDs, Shah says some admit to it and most don't. Surat itself has 14,000-15,000 LGD machines, according to the LGD Council, followed by 400 in Mumbai, 200 in Jaipur, 25 in Delhi and 200 being planned in Hyderabad. 'With new companies and different brand names, the younger generations educated abroad have taken to LGDs. But the 30-odd big diamantaires have an inventory of natural diamonds worth Rs 200 crore each, so they aggressively defend the traditional system,' he adds. That's led to a paradoxical push: resources have been diverted to marketing natural diamonds over LGDs, a campaign that's yielding some results. In a slack global market, India has risen over China as the second largest destination for the genuine article. But Shah believes the future potential lies with LGD. Survival remains key for all players—whether at the top or the bottom of the pyramid.advertisementSubscribe to India Today Magazine- Ends