India’s LGDs are cheaper but natural diamonds will still be in demand

Similar to a natural diamond, a lab-grown diamond is graded based on the 4Cs — clarity, color, cut and carat weight.

Lionel Bonaventure | Afp | Getty Images

Demand for lab-grown diamonds in India has grown steadily, but naturally mined diamonds won’t be losing their sparkle any time soon, industry experts say.

India currently has the world’s largest youth population. More and more millennial and Gen Z shoppers have been captivated by the so-called LGDs because of their price point, analysts told CNBC.

The price of a lab-grown diamond can be five times cheaper than a natural diamond, but they are both chemically identical.

According to Limelight Diamonds, one of India’s largest LGD jewelry brands, a natural diamond is priced at around $6,000 per carat while its LGD counterpart is just $1,200.

Both are also graded based on the 4Cs — clarity, color, cut and carat — the widely accepted standard characteristics to determine a diamond’s value and quality.

Sales of LGDs have skyrocketed as buyers in India who were previously unable to purchase diamonds due to their high cost now feel they can enter the market. 

“Previously, less than 5% of Indian women were able to afford natural diamonds,” said Pooja Sheth, founder and managing director of Limelight Lab Grown Diamonds.

“But consumers are feeling it’s more value for money to purchase a lab grown diamond and there is a huge amount of incremental demand from new purchases who have never bought a diamond before,” she commented.

India is currently the second-largest lab-grown diamond producer, behind China which accounts for at least half the world’s production.

Edahn Golan, the CEO of Edahn Golan Diamond Research and Data, said he’s optimistic the South Asian nation could soon be No. 1.

China’s LGD market is bigger in terms of production, but it is not polishing as many gems as India, Golan explained. “The technology that is used in India is far more sophisticated, and has much more room for improvement over time in the future,” he told CNBC in a phone interview.

“China can make more diamonds with the technology they are using, but India can make more, and make them better.”

Chance to upgrade?

Limelight Diamonds has sold 10,000 carats worth of LGD jewelry from April 2022 to March this year, according to the company. Sheth claimed the company has already seen nearly twice as much sales from just April to September this year.

However, Sheth pointed out that many buyers are not necessarily spending less when buying LGDs.

“Lab grown diamonds have provided a purchasing upgrade. Even though prices are cheaper, many are not reducing their budgets,” she said.

“They are either upgrading themselves with a bigger rock, or buying a pendant and [a pair of] earrings with that.” 

First lady Jill Biden, U.S. President Joe Biden and Indian Prime Minister Narendra Modi participate in an arrival ceremony at the White House on June 22, 2023.

Anna Moneymaker | Getty Images News | Getty Images

Much of the optimism surrounding LGDs in…

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India’s LGDs are cheaper but natural diamonds will still be in demand

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