The proposed 15-year income tax emption for rough diamond sale in India under the Taxation and Other Laws (Amendment) Bill, 2026 has the potential to make India as large rough diamond trading hub as the country already leads in cut and polish trade.The Bill proposes income tax exemption till March 31, 2041, for eligible foreign mining and trading entities including sightholders, brokers, aggregators and tender and auction entities on the sale of rough diamonds conducted through notified Special Notified Zones like those in Mumbai and Surat.Currently, foreign entities are allowed only to showcase their rough diamonds at SNZ. Domestic cut and polished diamond companies have to buy in the miners’ online auction conducted overseas.Challenge to Dubai?Currently, Dubai holds 75-80 per cent of roughs trading business and 90 per cent rough diamond buyers are from India.Kirit Bhansali, Chairman, Gem and Jewellery Export Promotion Council (GJEPC), said the Bill once passed by both the Houses will be a game changer for rough trading hub and it was long pending demand from GJEPC to the Ministry.If India allows rough diamond trading tax-free from SNZ, minersm across the world will come here to do their business and this will benefit MSMEs as their trip to Antwerp and Dubai can be avoided, he said.Eliminating middlemenIndia will emerge as trading hub for roughs as it already cuts and polishes 14 out of 15 diamonds sold world-wide, he said.Colin Shah, MD, Kama Jewelry, said India has been the diamond processing hub for the longest of time, but the country’s share in direct rough diamond trading remain below 5 per cent due to past tax fiction.The proposed tax policy measure cuts the procurement cycle by 15-20 days and eliminates middleman markups, ultimately lowering raw material costs up to 5 per cent and boosting India’s price competitiveness in key international markets, he said.The move has the potential to unlock an additional $3-5 billion of polished diamond exports and redefine the positioning of India as the world’s primary processing hub to trading capital of rough diamonds in the long run, he added.Rough trading hubAarav Bafna, Director, Akoirah by Augmont said the move can encourage mining companies and international suppliers to bring more of their inventory directly to Indian buyers.For the Indian industry, it mean better access to rough supply, greater price discovery, more competition among suppliers and potentially more efficient procurement, he said.India has the potential to become rough-diamond trading hub as it is already the world’s most important centres for diamond cutting and polishing, particularly in Surat, he added.Prithviraj Kothari, President, India Bullion and Jewellers Association said domestic processors can buy raw materials locally, bypassing traditional trading capitals like Antwerp or Dubai.Direct sourcing will slash cost and reduce working capital pressures for SMEs besides the steady supply chain protects livelihoods of over 5 million skilled cutting and polishing workers, he said.Published on August 5, 2026