The Indian Institute of Technology, Madras (IIT-M) will receive a research grant of Rs 242 crore for the study and development of lab-grown diamonds (LGDs), the institute announced on Thursday.

The research will concentrate on promoting the indigenization of the LGD manufacturing process.

Finance Minister Nirmala Sitharaman stated in Parliament on Wednesday, "The LGD is a technology and innovation-driven emerging sector with high employment potential."

"These environment-friendly diamonds have optically and chemically the same properties as natural diamonds. To encourage indigenous production of LGD seeds and machines and to reduce import dependency, a research and development grant will be provided to one of the IITs for five years," the Finance Minister added.

As per a recommendation made by the Department of Commerce, the research grant of Rs 242 crore over a period of five years to IIT-M has been approved, the statement said.

"This is indeed the right time to set up a diamond factory in India, given that diamonds have thermal and electrical properties making them superior to contemporary technologies like silicon, silicon carbide and gallium nitride. IIT-Madras will work towards producing diamond wafers suitable for electronic applications," Prof. V. Kamakoti, Director of IIT-M, said.