Slow down in diamond industry: No purchase of rough for one month

Surat

Rumors spread via social media harm business atmosphere in diamond industry worse, said Dinesh Navadia, president of Surat Diamond Association.

He said if such messages are stopped, the business atmosphere may fast improve. He added that legal action against those spreading rumour is one of the options.

Such messages are increasingly in circulation after two three diamond firms turned defaulter recently, he added and further said that some units have increased their output and market is likely to improve for Christmas demand.

Navadia said rumors spread over social media creates a situation of lack of trust in market.

He said even when some diamond firm turns defaulter, about 60% payment is recovered after itervention by community leaders and others. Even for rest 40% amount, efforts do continue.

He admitted that since 2013, about 42 diamond firms have turned defaulter, but added that most of them were smaller units.

It is observed that due to lack of trust, diamond market in Surat has for last sometime witnessed cash-only regim. RTGS money transfer over just one phone call talk was very common here earlier, but not anymore.

Navadia said post-Diwali, about 300-400 smaller diamond units have shut down their business. Maximum complains from workers received is 150 so far. At present less than 60 workers are in talk with Association for their 15 days payment stuck in some closed units including Godhani Gems.

He said diamond industry was already facing shortage of about 30% skilled workers and therefore there’s no major challenge so far as reemployment of relieved workers is concerned.

After year 2008 slow down, rough diamond prices have increased by 6 fold while polished diamond rates have been steady or in reverse mode in some varieties post 2014. Those doing business in smaller margin are doing well.

It is learnt that a meeting of 50 diamond businessmen was held at Surat Diamond Bourse in Mumbai on Saturday in which a decision was taken to halt import of rough for one month. In 2008 slow-down period import was halted for three months. Another such meeting is scheduled to take place on Tuesday in which around 200 businessmen may take part.

DeshGujarat