About two-thirds of the city’s diamond polishing units have not called workers back after the Diwali break. With G7 banning Russian diamond imports from January and Russian diamonds processed in third countries from March, the scenario is bleak in Surat.
While the ban is on big rough stones and not small roughs, which is Surat’s field of expertise, about 70 per cent of the diamond polishing firms in Surat deal in small diamonds. Imports from ALROSA make up 30 per cent of the rough stone supplies.
Vijay Mangukiya, regional chairman of Gems and Jewelry Export Promotion Council (GJEPC) says, “ALROSA was a major supplier of low quality roughs, which are cheaper, low in volume and high in quantity. These are fast-moving diamonds and require high labour deployment. Without ALROSA, the rough supply will be supplemented by other players, but it will be a minimum 10-15 per cent costlier. This means the small- and medium-scale polishing firms will have to reduce the quantity of roughs, forcing labour retrenchment."
All of this means that after some adjustments in procurement strategy, the bottomlines of the importing and polishing firms and even the traders may not be affected. However, the artisans will be dealt a body blow affecting labour retrenchment of 30-35 per cent in the coming months. India’s diamond industry, headquartered in Surat and spread in Mumbai, Saurashtra, Ahmedabad and Rajasthan, employs up to 800,000 polishers.
Aware of the potential crisis, the GJEPC, in a statement, said, “The decision raises valid concerns for the Indian gems and jewellery trade. We had engaged with the G7 to discuss such sanctions and their implementation. We have reservations on the timelines announced for the implementation of restrictions. Recognising the diversity of our industry, we believe there should be more flexibility in these timelines. GJEPC will strongly advocate that when regulating the sanctions, the interests of SMEs (small and medium enterprises) and marginal diamond units should be kept in mind, recognising their active contribution to this industry and the millions of livelihoods which are dependent on it.”
Aruna Gaitonde, Editor in Chief of the Asian Bureau, Rough & Polished
