Prime Minister Narendra Modi and Russian President Vladimir Putin aiming to boost bilateral diamond trade is good news for the domestic industry, it is imperative for banks to support the “next generation” of Indian diamantaires if the industry is to grow, said industry officials at the World Diamond Conference that ended here on Friday.
“Centres must be conscious that they need to prepare the next generation in this industry. The new Venus (Jewel), Hare Krishna (Exports) and similar giants will be created only if the banking system supports them. I request bankers to look at small and medium companies in India as this is where the future will be built,” said Stephane Fischler, President, Antwerp World Diamond Centre (AWDC).
Twelve Indian companies signed three-year contracts worth around $2.1 billion to source the precious stone from Russian diamond mining major ALROSA at the conference earlier. Indian companies like Hare Krishna Exports, Venus Jewel, Rosy Blue, Dimexon Diamonds, KGK Diamonds and the Karp Group are among those which will benefit.
Fischler added that the deal was unlikely to affect global supply channels. “International supply channels are already well established. What is important is to concentrate on the core competencies of distinct centres, whether in Antwerp, Israel or Mumbai, and to use synergies to better the industry”, he said.
Russian flavour
The conference was one that brought delegations from various parts of the world but retained a distinct Russian flavour with Modi and Putin jointly inaugurating the event.
The ALROSA deal was a step in the right direction, delegates felt, and the event had opened up possibilities of furthering Indo-Russian diamond trade with the Prime Minister announcing the establishment of Special Notified Zones to facilitate the import of rough diamonds on a consignment basis from Russia and allowing unsold ones to be exported back.
“The Government’s role starts with ensuring that we have responsible and sustainable mining plans. After that, it is to ensure that all diamond trade is transparent. We will help facilitate, not engage in business,” said Siddharth Singh, Joint Secretary, Commerce Ministry.
India imports most of its rough diamonds from Russia but domestic manufacturing costs and those borne by consumers are usually increased due to less than 20 per cent of the roughs coming in directly. Most reach India through hubs like Antwerp, Tel Aviv and Dubai.
Russia is the leading rough diamond producer while India is the world’s largest manufacturer of cut and polished diamonds.
“The relationship between these two countries must be nourished and they must come together in manufacturing to become a formidable unit. The contract between ALROSA and the Indian companies is a great initiative since it eliminates middle men,” said Maxim Shkadov, President, International Diamond Manufacturers Association (IDMA).