Indian diamond traders purchasing rough precious stones from major Russian miner Alrosa could be eligible for loans from Russian banks, as domestic lenders have reduced financing for the gem and jewelry sectors.
Russian banks have already started granting money to Alrosa’s foreign clients, according to the Economic Times. The measure could boost India’s diamond industry, which has been lacking a source of financing since notorious jeweler Nirav Modi was accused of being involved in a $2.5+ billion fraud case in India. The billionaire was arrested in London in 2019 after managing to enjoy a lavish lifestyle in London for more than a year while on Interpol’s Red Notice list.
“This will definitely help those who buy rough diamonds from Antwerp,” the Gem and Jewelry Export Promotion Council’s Vice Chairman Colin Shah said, as quoted by the outlet. “If the Russian banks come forward with business-friendly lending norms, then it is good for the Indian diamond trade.”
Indian banks doing business in the epicenter of the diamond industry – Antwerp in Belgium, source of the bulk of rough diamonds that come to India – have winded down diamond financing in the city. Meanwhile, the lenders operating inside the country have also reportedly limited credit opportunities for the sector.
India has emerged as the largest diamond-cutting center in the world, with between 70 and 90 percent of all diamonds sent there to be cut. Russia’s Alrosa is the leading supplier of diamonds in the world, according to the company, and it has long been cooperating with the South Asian nation. The miner signed 14 long-term contracts with diamond manufacturing companies in India for 2018-2020, and in 2017 it supplied the country with precious stones worth almost $700 million.