Surat: Surat, the world’s largest lab-grown diamond (LGD) polishing centre, is missing the opportunity to emerge as a major trading hub for the rapidly growing segment, even as Dubai moves aggressively to capture the business.The Dubai Multi Commodities Centre (DMCC) on Sunday announced the establishment of a dedicated LGD vertical after trading of lab-grown diamonds through the UAE surged more than 91% year-on-year to around 77 million carats in 2025. DMCC is also positioning LGDs as an industrial material, focusing on applications beyond jewellery, including semiconductors, diamond wafers and quantum technologies.The development comes as a setback for Surat, which had hoped to replicate its dominance in LGD polishing in the trading business. When natural diamond trading hubs emerged in Antwerp, Mumbai and Dubai, Surat’s lack of world-class business infrastructure and international connectivity was cited as a key disadvantage.Today, however, Surat has the world’s largest office building — the Surat Diamond Bourse (SDB) — as well as international air connectivity. Yet the bourse remains largely underutilised. Of its 4,700 offices, only around 300 are operational, with most manufacturers and traders dealing in natural diamonds. Only around five offices currently operate exclusively in LGDs.One of the largest offices at SDB belongs to Kira Diam, which has operated from the bourse since its launch in December 2023. Apart from four LGD traders, no major grower, manufacturer or trader has shifted to SDB.“Not only trading, but we are exporting our goods directly from SDB and, despite being the only major LGD player operating from here, we are not facing any issues. Imagine how beneficial it could be if the entire market shifts and operates from this campus,” said Vallabh Lakhani, founder-chairperson of Kira Diam.The missed opportunity is particularly significant as India’s polished LGD exports touched 18.80 million carats in 2025-26, surpassing cut and polished natural diamond exports in volume. Despite Surat’s growing dominance in LGD polishing, a substantial share of trading is taking place in Dubai, barely an hour away by air.Babu Vaghani, president of the Surat LGD Association, attributed Dubai’s advantage partly to its tax benefits. “Dubai-like tax benefits are not offered at trading hubs such as SDB. We can hope for such benefits to attract traders in large numbers,” he said.Operating costs and the existing manufacturing ecosystem are other factors keeping traders away from SDB, Vaghani said. “The majority of LGD traders also have manufacturing operations in the city and therefore prefer to operate from their existing offices. Manufacturers do not want to incur additional operational costs at two locations,” he said.The Gem and Jewellery Export Promotion Council (GJEPC) said SDB could expand its Special Notified Zone (SNZ) if demand emerges, but the larger challenge is getting the industry to move together.“If there is demand, the SNZ can be expanded at SDB. But the key issue is that people are not willing to shift the entire market to SDB. If the entire trade shifts here, an ecosystem can be created. Without an ecosystem, SDB cannot grow into a global diamond trading hub,” said Jayanti Savaliya, regional chairperson, GJEPC.Lalji Patel, vice-chairman of the SDB core committee, said LGD businesses are present at the bourse but there are currently no dedicated facilities for the segment. “Some offices, apart from Kira Diam, dealing in LGDs have also started operations,” he said.
