Economics

Budget 2023: What Are Lab-Grown Diamonds And Why Government Is Betting On Them

Swarajya StaffFeb 01, 2023, 02:54 PM | Updated 03:10 PM IST
A diamond. (Needpix)

A diamond. (Needpix)


"Lab-grown diamonds is a technology and innovation-driven emerging sector with high employment potential," said Finance Minister Nirmala Sitharaman in her Budget speech.

To encourage production of lab-grown diamonds, the Union government will provide a research and development grant to one of the IITs for a period of five years.

To reduce the cost of production of such diamonds, a proposal to reduce custom duties on 'lab-grown diamond seeds' is also present in the Budget (Part B).

What are lab-grown diamonds and how are they produced?

  • Lab-grown diamonds are also known as CVD diamonds. Here, 'CVD' stands for 'chemical vapour deposition', the process by which these diamonds are produced.

  • Lab-grown diamonds have the same physical, chemical and optical properties as natural diamonds.

  • Chemically, they undergo more or less the same process as the naturally-occurring diamonds.

  • A thin layer is first cut from a natural diamond, to form the lab-grown diamond's seed.

  • This seed, which is 100 per cent carbon, is then polished and placed in a plasma reactor.


  • Eventually, carbon particles begin to disintegrate and form layers on the original seed.

  • Ultimately, this forms a rough lab-grown diamond, just as a rough natural diamond.

  • This rough diamond is then cut and polished to take it to its final form.

  • Why the Union government want to go big on them

    • As per 2021 data, India is the largest importer of diamonds in the world.

  • In 2021, India reportedly imported diamonds worth $26 billion.

  • An ecosystem to produce lab-grown diamonds will help reduce this part of India's import bill.

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