Japan and the United States are exploring a major push into synthetic diamond production as part of Japan’s $550 billion investment plan.

Axar.az, citing Japanese Times, reports that one of the flagship projects could be a synthetic diamond plant in the U.S., involving Element Six, a division of the De Beers Group. The initiative aims to create a U.S.-Japan supply chain independent of China, whose recent export controls on artificial diamonds highlighted the material’s strategic importance.

Synthetic diamonds are critical for high-precision manufacturing, including semiconductor polishing, machining of hard metals and ceramics, heat dissipation in electronics, and potential military applications.

The investment package, set to be announced ahead of Prime Minister Sanae Takaichi’s potential U.S. visit in March, may also include large-scale power-generation projects and data center construction involving Hitachi and SoftBank. Funding would come through equity, loans, and guarantees from Japanese state-owned agencies.

This move aligns with broader efforts by both nations to secure critical industrial supply chains, while U.S.-Japan trade negotiations and tariff discussions continue with other partners, including South Korea.