Full Breakdown
Impact of US Tariffs on India's Diamond Industry and Education
12/9/2025, 6:16:09 AM
Economic Downturn in Surat's Diamond Industry
The diamond industry in Surat, India, has long provided a pathway to improved livelihoods for workers, particularly migrants from rural Gujarat. However, recent economic shocks have severely impacted this sector. Following Russia's invasion of Ukraine in 2022, supply chains were disrupted, leading to significant layoffs and reduced earnings for many workers. The situation worsened with the imposition of 50 percent tariffs by the United States under President Donald Trump, which contributed to a 27.6 percent decline in India's exports of cut and polished diamonds for the financial year ending March 31, 2024. As a result, nearly 400,000 workers faced layoffs, pay cuts, or reduced hours, forcing many families to reconsider their children's education.
Personal Stories of Struggle
Alpesh Bhai, a diamond cutter, experienced a drastic decline in his income from 35,000 rupees ($390) to as low as 12,000 rupees ($133) per month. This financial strain forced him to withdraw his children from private school, where tuition fees reached 25,000 rupees ($280) annually. Similarly, Shyam Patel returned to his village after losing his job, leading to his son dropping out of high school. The emotional toll on families is evident, as many children express dissatisfaction with the quality of education in public schools compared to their previous private institutions.
Educational Crisis and Dropout Rates
The educational landscape in Surat has been significantly affected, with over 600 students leaving school mid-session last year due to parental job losses. The Diamond Workers Union Gujarat reported that approximately 50,000 workers have left Surat in the past year, indicating a troubling trend of migration back to rural areas. The Vishwa Hindu Parishad, a Hindu nationalist group, noted that the number of school dropouts has reached alarming levels, with government schools struggling to accommodate new students. The quality of education in public schools is a concern, as evidenced by data showing that only 23.4 percent of grade three students could read at a grade two level in 2024.
Government Response and Challenges
In response to the crisis, the Gujarat government introduced a special assistance package for unemployed diamond workers, covering one year of school fees for their children. However, the program has faced criticism for its strict eligibility criteria, which exclude many workers experiencing partial job losses. By mid-September, only 6,368 children had received assistance, while about 26,000 applications were rejected, leading to frustration among families.
Mental Health and Community Impact
The economic downturn has also led to a rise in mental health issues among workers, with the Diamond Workers Union reporting at least 71 suicides by November 2024. The union has established a suicide prevention helpline, which has received over 5,000 calls. Families like that of Divyaben Makwana, who lost her son to suicide due to financial stress, highlight the dire consequences of the ongoing crisis. As she navigates her new reality, she expresses doubt about the effectiveness of education in changing their fate, emphasizing the community's reliance on the diamond industry for recovery.
Conclusion
The combination of US tariffs and the fallout from geopolitical events has created a perfect storm for Surat's diamond industry, leading to significant economic and educational challenges for workers and their families. As the community grapples with these issues, the future remains uncertain, with many hoping for a recovery in the diamond market to restore their livelihoods and educational aspirations.
