[India Niche Market] India’s Lab-Grown Diamonds (LGD)

Let’s take a look at India’s diamond industry as a niche market.

— From Gemstones to Semiconductor Substrates: Why SpaceX is Keeping a Close Eye on Indian "Diamonds" — When people think of "India," they usually think of IT services or a massive consumer market. However, few realize that 9 out of 10 diamonds in the world are cut and polished in Surat, in the state of Gujarat, India. Today, India’s Gems & Jewellery (G&J) industry is evolving beyond consumer goods into a core pillar of the advanced industrial materials supply chain , drawing intense focus from global aerospace giants like Elon Musk’s SpaceX, as well as South Korea’s next-generation semiconductor industry. We often interpret India solely through the lens of macro-manufacturing discourses such as semiconductors, shipbuilding, and automotive. Yet behind the clear, conglomerate-led blueprints lie "hidden possibilities" forged by India's unique infrastructure and foundational competitiveness. The [India Niche Market] series shines a light on the theoretical synergies and future supply chain diversification opportunities that South Korean SMEs (small and medium enterprises) can practically tap into, away from massive national projects. We explore what new puzzles can be solved when India's unexpected raw material strengths meet South Korea's ultra-precision processing technologies. 1. Why India’s Gems & Jewellery Industry Dominates the World India is the world's largest diamond processing hub and gold consumer. At its heart sits Surat, which is not just a manufacturing complex, but a massive, highly integrated precision-processing ecosystem . An Overwhelmingly Skilled Ecosystem: Surat boasts a unique structure where generations of cutting craftsmanship merge with cutting-edge CNC/laser equipment, grading, logistics, and financial systems. Traditional artisans are transforming into tech talents who seamlessly operate highly sophisticated precision machinery. Notably, their micro-level processing expertise is being transferred directly to the post-processing of industrial diamonds. Government-Led Structural Support: Beyond operating Special Economic Zones (SEZs) and allowing 100% Foreign Direct Investment (FDI), the Indian government has recently concentrated its policy resources on building a global trading hub centered in India. 2. Lab-Grown Diamonds (LGD): From Gemstones to Advanced Materials Recently, India’s sharpest focus has shifted toward Lab-Grown Diamonds (LGD), which are synthesized in laboratories. The Rise of the CVD (Chemical Vapor Deposition) Method: India has secured the world's largest capacity for bulk diamond growth using the CVD method. Economic Viability: The affordable industrial electricity essential for diamond synthesis, backed by the Indian government's power subsidy policies, is the primary driver behind India becoming the world's most price-competitive supplier of raw LGD materials. 3. The Obstacle Faced by SpaceX and KASA—and Why 'Diamonds' Are the Answer The recent scrutiny of India’s LGD ecosystem by the global aerospace and semiconductor industries stems from the unique physical properties of diamonds. Diamonds possess the highest thermal conductivity of any known material and exhibit exceptional radiation resistance compared to conventional silicon , making them a premier next-generation material. ▶ Technical Barriers in the New Space Era: Thermal Management and Radiation SpaceX’s Challenge: The electronic components in Elon Musk’s large-scale low Earth orbit (LEO) satellites (Starlink) or Mars exploration vessels (Starship) face extreme environmental constraints—namely, a vacuum with no convection for heat dissipation and intense exposure to cosmic radiation. The Launch of KASA and South Korea’s Immediate Task: This is a hurdle that South Korea’s Korea Aerospace Administration (KASA), officially launched in 2024 to lead the space economy ecosystem, alongside domestic materials, components, and equipment companies, must overcome. A Promising Technical Alternative: To completely control the heat generation of internal high-power AI chips and communication equipment while drastically reducing system weight, companies are actively reviewing and researching the introduction of "diamond substrates" (GaN-on-Diamond) and next-generation heat sinks that combine silicon with diamond thin films. ▶ US-India-South Korea Aerospace & Defense Supply Chain Momentum Alongside these technical drivers, geopolitical shifts aimed at securing global supply chain stability are amplifying India's strategic value. US-India Summit and the 'Physical Stack' Cooperation Declaration: At the US-India summit held just yesterday (June 17), both leaders made it clear that the essence of AI innovation extends beyond software to the stability of the "physical hardware infrastructure"—including compute resources, processors, and the specialized materials that support them. Within this US-led advanced technology alliance , India’s LGD ecosystem is rapidly moving into the mainstream as a critical source o