India's ultra-wealthy elite are increasingly turning their attention to a sparkling new asset class: rare coloured diamonds. Moving beyond conventional jewellery, these individuals are embracing pink, blue, and yellow diamonds as both bold fashion statements and serious long-term investments, fuelling a remarkable surge in the market.
A Rainbow of Returns: Prices and Popularity Soar
Over the past year, demand for these exquisite stones has spiked by an impressive 20% to 25%, even as their prices continue an upward climb. According to industry reports, India has emerged as one of the world's fastest-growing markets for coloured diamonds since the pandemic, powered by a new generation of globally-aware, asset-conscious ultra-high-net-worth individuals (HNIs).
The price gap between white and coloured diamonds is vast. While a carat of a traditional white diamond may cost between Rs 1 lakh and Rs 7 lakh, coloured stones command a staggering premium. Pink diamonds, for instance, range from Rs 15 lakh to a whopping Rs 5 crore per carat. Blue diamonds are priced between Rs 25 lakh and Rs 5 crore per carat. Yellow diamonds, seen as a more accessible entry point, are comparatively lower, priced between Rs 5 lakh and Rs 15 lakh per carat.
Scarcity and Global Trends Fuel the Frenzy
The driving force behind this boom isn't just beauty. Extraordinary price appreciation and rising scarcity are key factors. With no significant new mines becoming operational, these rare gems are being viewed as compelling alternative investments. In rupee terms, pink diamond prices have multiplied tenfold over the last twenty years. Blue diamonds have risen six to seven times, while yellow diamonds have roughly doubled in value.
Darshit Hirani, co-founder of P Hirani Exports, highlights the influence of global trends. "Demand is also driven by the fact that celebrities and businessmen across the globe are embracing coloured diamonds for weddings and other special occasions. Wealthy Indians want to be part of this global trend," he told ET. He noted an interesting geographical shift: HNIs from tier II cities are now showing keen interest, often starting their collection with yellow diamonds.
Changing Consumer Patterns and a Tight Supply
Buying patterns also reflect generational differences. Hirani, with over four decades of experience, observes that larger stones (1-2 carats) are typically bought by HNIs aged 45 and above. Younger buyers from affluent families or high-salaried professionals are gravitating towards smaller and mid-sized stones.
The post-pandemic consumer is more discerning. Ishu Datwani, founder of Anmol Jewellers in Mumbai, notes that exposure to global luxury brands like Chopard and Cartier has evolved Indian tastes. "They now want us to create pieces that resonate with their evolved tastes," he said, adding that demand for fancy yellow diamonds sourced from Australia, Russia, and South Africa has risen sharply.
Globally, these diamonds are auction superstars, especially in Asia. A July 2024 report by the Natural Diamond Council estimated the wholesale value of fancy colour diamonds entering the market this year exceeds $4.5 billion. The supply, however, is critically limited. Coloured diamonds constitute less than 1% of global diamond production. The 2020 closure of Rio Tinto’s Argyle mine, which supplied over 90% of the world's pink and red diamonds, has drastically tightened supply. With no alternative source found, dealers confirm that intense scarcity is forcing buyers to compete aggressively for remaining inventory, often at any cost.
