Ishendra: So, lab-grown diamonds essentially are diamonds which have the  same properties—which are exactly the same as diamonds—but are made in a lab, right? They are not mined, but then they are made in a lab. So you get the same carbon composition that you get in a mined diamond, you get the same hardness, you get even better clarity and cuts of the diamond. But it is just that, rather than mining it from Mother Earth, you get it in a laboratory.

Rohin: Yeah, I read a good analogy somewhere: the ice which is made in your refrigerator versus that you might find naturally occurring in nature, right? Both are ice.

Praveen: So, if I was a jeweller and I gave you two diamonds—one was a lab-grown diamond, one was a natural diamond—would I be able to tell the difference at all?

Ishendra: No, you will not be able to tell the difference.

Rohin: Even an expert jeweller can’t tell the difference?

Ishendra: No, you can’t. Now, people are trying to do research in terms of finding one impurity which is there in mined diamonds, which is the boron impurity, that is not there in lab-grown diamonds. But otherwise, you can’t tell the difference between a mined diamond and a lab diamond.

Ishendra: Typically, you get a lab-grown diamond at a retail level at 1/7th to 1/8th of the price. But when you polish it… it comes out to be 1/3rd to 1/4th of the price of the mined diamond.

Ishendra: What was happening in the diamond industry was there was one player who was controlling the complete supply for diamonds, right? Mother Earth had diamonds for everyone, right? But it was just one player who had more than 80% of the supply, and they were controlling it.

Rohin: The 11th person will set up a factory and sell it at 10% less. The 12th person will set up a factory and sell it at another 10% less, till at some point… technology limits are hit.

Ishendra: We have. So what I’m saying is, if you see how the prices of lab diamonds started, it actually started similar to the mined diamond prices… The reason why it fell faster was exactly because of what you said, because more and more people started coming in and started setting up factories.

Ishendra: The prices where the lab diamonds have come over the last six months is now rock bottom… from here to practically taking it further down or even to zero is just not possible for a businessman to do this business.

Ishendra: So what happens when you get a diamond, it is in a raw shape… And for it to disperse the light, you need to polish the diamond into different cuts, right? And that part of the value chain is largely done by Surat for the entire world.

[…]

Ishendra: If you see, more than 90% of the diamonds of the world were polished by Surat… largely because Surat has the cheapest labour compared to the other countries and it has the best techniques.

[..]

Rohin: The cost of polishing a diamond in, let’s say, China is again, as per this article, fascinating, right? It cost about 400 renminbi to polish it in China which is roughly equivalent to $56… In India it’s 86 (renminbi)… So that’s the Surat advantage.

Praveen: Do lab-grown diamonds also need polishing?

Ishendra: Yes, they do. So, when you make them in the lab, you also get them like a stone, right? Just like how you get mined a diamond. And then you polish it.

Ishendra: The thing which I was thinking of as a store of wealth is actually not a store of wealth. It is a very aspirational fashion accessory that I’m wearing.

[…]

Rohin: Remember, fashion jewellery used to be almost like a pejorative in India. When you talk to someone, you know, 10, 20 years ago… like, ‘oh, this is fashion jewellery,’ there was always this thing of it’s not real jewellery.

Ishendra: If you see the evolution of the Indian consumer over the last 10 years, right? One major pillar of that evolution is our women workforce participation has increased significantly. And when you go out, you essentially want to wear fashion, right? You want to wear different things every time.

Ishendra: Now, when you buy a 2 lakh or a 3 lakh rupee jewellery piece, it will sit in your lockers… it is not something you can buy 10 pieces of or you can buy different pieces every time, right?

Praveen: So you’re saying that there is this middle ground… it’s not this thing where I get the whole thing of very expensive jewellery that you’ll wear, you’ll take it out maybe for your daughter’s wedding… But there’s this big middle where you actually want to wear different jewellery every time and you want to wear it for longer durations.