After the Russian invasion of Ukraine, diamonds are not forever. Diamond bazaars in India have gone quiet in recent weeks following U.S. sanctions on Russian diamonds, making nuptial ceremonies in the U.S. a costly affair.

All India-Russia diamond trade involving U.S. citizens have been affected due to the U.S.-led sanctions against Russian state-owned Alrosa, the world's largest diamond mining company which accounts for 28 percent of global diamond mining. 

Russian raw diamonds make up 40 percent of India's diamond trade volume and about 30 percent in value of India's $18-billion industry, employing 4.64 million hands.

With the shortage of raw materials, large factories in Surat, the global diamond polishing hub in western India, are forced to shut shop and give employees an unscheduled break. India is set to lose $2.5 billion this quarter due to disruption in supply from Russia.

On April 8, U.S. Secretary of State Antony Blinken described supplies from Alrosa as "conflict diamonds." Since then, the global diamond industry has gone for a toss with no silver line at the end of the tunnel. The cost of diamonds has spiked 18-20 percent in the global market due to the sanctions.

RapNet, the world's largest diamond and jewelry trading platform, has banned Russian diamonds from its network which has daily listings of 1.8 million diamonds valued at $8.7 billion.

The ban applies to all diamonds sourced from the Russian soil, Rapaport noted in a press release, according to May 17 media reports. 

Under the order by the Department of the Treasury, U.S. citizens, who are the largest buyers of diamonds in the world, cannot possess Alrosa properties. If they do so, it must be reported to the Office of Foreign Assets Control (OFAC) of the Department of the Treasury. 

The U.S. clients are insisting on Indian traders to furnish certification to show that the stones they deal with are not sourced from Russia. 

A delegation from Alrosa came to India in April to hold talks with trade groups. But talks failed to produce any positive results. Currently, India is trying to re-route Russian diamonds to friendlier markets in China, Southeast Asia, and the UAE. 

The order against the world's largest diamond mining company came ahead of the marriage season in the U.S. The price of a small, rough diamond that is clustered around the solitaire stone in a wedding ring has increased by 20 percent since March.

Close to half the polished diamonds used at nuptial ceremonies in the U.S. are sourced from India. As pandemic restrictions are being eased, Signet, Tiffany & Co. and other U.S. jewelers were banking heavily on the 2.5 million weddings season in the U.S. this year after a four-year lull.

Though European countries have yet to restrict imports of Russian luxury goods, the list is expected to grow as NATO and the U.S. increase their aggressive actions against Russia and its commodities. The UK is trying to prohibit high-end items from diamonds to caviar from Russia by imposing heavy taxes. 

The U.S. sanctions on Alrosa and Russia are the latest blow to the global diamonds market which is already beleaguered by supply chain woes and rising inflation.

As a result, the ban on diamonds sourced from Russia may prove to be good for lab-grown diamonds. Botswana, Africa's top diamond producer, has already expressed concern that a ban on Russian diamonds will open the way for synthetic gems to expand its market share.

"We see the 30 percent gap that will be left by the ban being plugged by something else that is not natural," Lefoko Moag, minister of minerals of Botswana, told a mining conference in the country on May 16.

Alrosa is unlikely to sell large volumes this month. Its chief executive, Sergei Sergeevich Ivanov, was sanctioned by the U.S. after Russia invaded Ukraine Feb 24. He is the son of Sergey B Ivanov, one of the closest allies of President Putin. 

Diamonds are not like fossil fuels, where one nation can jump in to make up for the shortfall. There is little chance of an increase in supply before 2024. Mines of De Beers, the world's second major diamond provider, are running at full tilt and the company has only working reserves.  Thus, there is little possibility to tap into De Beers' vast reserves as the world market has resorted to earlier when faced with conflict diamonds.

Since no new mines are coming up elsewhere, the dependence on Russia is huge as Alrosa is a major player in the global diamonds market that stretches from permafrost-laden mines in Siberia, polishing units in India, glittering stores in the U.S, and secret trade syndicates in Antwerp in Belgium.