On Feb. 12, 2026, Washington announced it has lowered reciprocal tariffs on India diamonds and jewelry to 25% and said duties on diamonds and gemstones will be abolished once the bilateral agreement is final. The move immediately changes landed-cost dynamics for polished diamonds and finished jewelry sourced from India.

  • Tariff level: reciprocal tariffs reduced to 25%
  • Planned change: duties on diamonds and gemstones to be abolished once agreement is final
  • Date and notice: February 12, 2026 announcement
  • Market region: United States — India trade in diamonds and jewelry
  • Target segment: cut & polished diamonds and finished jewelry (bridal and fashion categories)

Context: where this sits in 2025–26 trade and category trends

The tariff reduction is a policy-level adjustment with direct implications for margin, assortment and sourcing strategy in the jewellery sector. For years, U.S. buyers have balanced cost, quality and traceability when importing Indian-cut diamonds and India-made settings. Lower reciprocal duties reduce the landed cost of inventory that features fine cut work — micro-pavé pavings, open-backed settings and pieces with intricate satin-finished goldwork — and may alter the relative economics between domestic production, third-country sourcing and inventory held for bridal versus fashion lines.

From a product standpoint, the change is relevant across items that rely on precision cutting and finishing — pieces that emphasize vitreous luster, tight facets and substantial heft rather than overt branding. Traders and buyers who import calibrated goods, melee for pavé work and finished bridal mounts will see the adjustment first.

Impact: why U.S. retailers, wholesalers and investors should care

Operationally, the immediate consequence is a shift in landed cost assumptions. Retail buyers and wholesalers should review cost sheets for SKUs that include Indian cutting or assembly; a lower tariff reduces the buffer required for margin protection and can enable tighter retail pricing or improved gross margin depending on strategy. Merchandisers may reprice items where the duty previously accounted for a portion of retail margin, while inventory acquired before the announcement will need reconciliation against new cost projections.

For sourcing strategy, the change removes a structural tariff premium on India-sourced goods and therefore narrows the gap to other sourcing destinations. That can accelerate replenishment of styles that depend on fine finish — knife-edge shanks, closed-back versus open-backed settings for colored stones — and influence decisions about onshore finishing versus full import. Marketing teams should refine provenance and value messaging: quiet-luxury buyers respond to material and craft cues (cut grade, finish, mounting technique) more than promotional discounting.

From an investor and category-level view, the announcement represents both risk and opportunity. Risk: faster price normalization could compress margins for players who cannot pivot assortments or negotiate supplier terms. Opportunity: brands and retailers that actively reprice and remerchandise may secure share by offering cleaner price architecture and clearer trade disclosures once duties are removed.

Next steps for trade participants are practical: update cost models, renegotiate supplier contracts with Indian partners, and align merchandising calendars to reflect any new landed-cost advantage for diamonds and finished jewellery once the agreement is implemented.

Image Referance: https://rapaport.com/market-comment/market-comment-february-12-2026/