A Gem of a Question on Buying Diamonds

For years, one was told diamonds are forever. But now the script is changing with the influx of artificial lab-grown diamonds over natural diamonds. Many are asking a question: Is it a wise or stupid idea investing in a natural diamond today? While miners continue to dig for natural diamonds, there has been a booming demand for artificially grown lab diamonds. The diamond question is no longer simple.

Walk into a jewellery store today and the question is no longer simply, “How many carats?” Increasingly, shoppers want to know: Why should I pay this much for a diamond that looks almost identical to one I can buy for considerably less?

Lab-grown diamonds are no longer a novelty or a compromise for shoppers who cannot afford the mined version. They have entered mainstream fashion jewellery, bridal collections and luxury retail and they are forcing consumers to rethink what exactly they are paying for.

Resale Problem

There is, however, a catch. Lab-grown diamonds generally do not have the resale proposition traditionally associated with rare natural stones. But here is where the conversation gets uncomfortable: natural diamonds have never been a straightforward investment either. Neha Roongta, Founder & CEO of Neha Roongta Fine Jewellery, argues that consumers should separate jewellery from financial assets. “No diamond, natural or otherwise, should be bought purely as a financial instrument,” she says. In her view, gold, real estate and equities are more appropriate choices when financial returns are the priority.

Neha explains that the value of a truly exceptional natural diamond comes from its rarity, something a laboratory cannot manufacture on demand.

That distinction matters. A beautiful two-carat diamond is one thing; an unusually large, exceptionally clear or historically significant natural stone is another.

Razzle Dazzle Time

The natural-diamond market could increasingly divide into two camps. At the lower and middle ends, where stones compete largely on appearance and price, lab-grown diamonds create formidable competition. “The stones that were only ever competing on sparkle are feeling the pressure,” she says. Her prediction is not the collapse of natural diamonds, but a “bifurcation”. Ordinary stones become more price-sensitive while genuinely rare stones become more collectible. Instead of simply selling a diamond as luxury, jewellers may increasingly have to explain why this particular diamond is rare — its size, quality, provenance, certification or history.

New Luxe Shopper

There is also a generational shift at play. For a younger shopper, luxury can mean owning several distinctive pieces rather than putting an enormous amount of money into one traditional engagement ring. Lab-grown diamonds fit neatly into that mindset. A consumer can choose larger stones, experiment with unusual cuts, stack rings, layer necklaces or buy statement earrings without treating every purchase as a once-in-a-lifetime financial decision.

The Cost Factor

Sanjana Tripuramallu, Founder of Bengaluru-based Cosmos Diamonds, believes the rise of lab-grown diamonds is doing more than creating a cheaper alternative. It is changing the basis on which consumers value diamonds. “Absolutely, the value and popularity of natural diamonds have traditionally been associated with scarcity and rarity, but the rise of lab-grown diamonds has broken the scarcity myth because essentially, with lab-grown diamonds, you have diamonds that are physically, chemically and optically the same at a much better price,” Tripuramallu says.

In her view, consumers now have a fundamentally different choice to make. “Customers are choosing a diamond because of its nature, size, sparkle, symbolism and beauty not because of its geological provenance.”

That shift becomes particularly significant when the conversation moves from luxury to investment. The decline in natural-diamond prices, she argues, has made the investment case harder to make. “The crash of prices in natural diamonds has further made it difficult for consumers to choose natural diamonds from an investment perspective,” she says.

The result is not necessarily that natural diamonds become irrelevant, but that buyers may increasingly have to decide whether they are purchasing a diamond for what it is or for the story attached to where it came from.

Future of Other Gems

Could rubies, emeralds and sapphires be next? This is perhaps the bigger question. If technology and changing consumer attitudes make buyers less willing to pay purely for the idea of rarity, other gemstones could eventually face similar pressure. Lab-created versions of sapphires, rubies and emeralds already exist, although natural-coloured gemstones with exceptional provenance can occupy an entirely different category. For Tripuramallu, the distinction becomes especially important when looking at coloured gemstones. “Definitely there will be increased pressure on natural diamonds, especially since they are identical in nature,” she says. “With the introduction of lab diamonds, consumers started questioning whether natural diamonds are really scarce or was its decades of marketing.”

Allure Of Natural Stones

Natural stones simply will not become worthless. The market is likely to become more segmented. “It’s not that they will become worthless. I believe the market will become interesting,” Tripuramallu says. “There will be a clear distinction between people buying diamonds for their beauty and natural stones for their collectability and provenance.”

With other gemstones with authenticity, like Tanzanites, Burmese rubies and Sri Lankan sapphires, the conversation on value is more complex and layered. “Origin, colour, treatments, inclusions everything matters. Technology can’t automatically create the same story,” she says.

That means natural gemstones may continue to command a premium among collectors.

“The value with gemstones will still exist with collectors and a portion of consumers,” Tripuramallu says. “But with the diamond industry, the story is different.”

The Final Takeaway

So, is it stupid to buy a natural diamond today? Not necessarily. If your priority is maximum sparkle, contemporary design and getting more stone for your money, lab-grown diamonds make a compelling case. If your priority is geological history, rarity, provenance and the possibility of owning something genuinely scarce, a high-quality natural diamond remains in a different league.

The diamond may still be forever. But the old definition of why it is valuable is clearly up for debate.

Box: Same Sparkle, Different Story

Technically, lab-grown diamonds are not fake diamonds. The Gemological Institute of America says they have essentially the same chemical composition, crystal structure and physical properties as natural diamonds. The key difference is origin: natural diamonds are formed deep inside the Earth over millions or billions of years, while lab-grown stones can be produced in weeks using technologies such as HPHT and CVD.

To the naked eye, the distinction can be virtually impossible to spot. It takes specialist equipment to reliably separate the two. And that creates an interesting fashion proposition. If the consumer wants the brilliance, the colour, the cut and the drama of a sizeable stone without paying a premium primarily for its geological history, lab-grown diamonds suddenly look like a smart styling choice.