Indian Diamond Companies – The Diamond Certification Laboratory of Australia (DCLA)

Huge Budget Boost for India’s Diamond Industry

*Nirmala Sitharaman finance minister of india in a press confrence .*

India’s diamond industry welcomed a raft of measures announced in today’s budget (23 July) which will encourage direct diamond sales from foreign mining companies and reduce tax on key raw materials.

Finance Minister Nirmala (pictured) said safe harbor rates would be introduced, providing fixed and favorable tax rates for rough purchases in the country’s SNZs (Special Notified Zones).

Safe harbor streamlines the taxation process and eliminates unexpected liabilities for foreign suppliers.

Sitharaman also announced significant tax reductions on gold and silver to 6 per cent (from 15 per cent and 10 per cent) and on platinum to 6.4 per cent (from 12.5 per cent) and the exemption of diamond sales from a 2 per cent equalization levy aimed at promoting sustainability.

“India is a world leader in the diamond cutting and polishing industry, which employs a large number of skilled workers,” Sitharaman said in her Budget speech.

“To further promote the development of this sector, we would provide for safe harbor rates for foreign mining companies selling raw diamonds in the country.”

“I want to applaud and congratulate the Central Government for their three-point game changing decisions for the gems and jewellery industry,” said Vipul Shah, chairman of GJEPC (Gem and Jewellery Export Promotion Council).

“The reduction of customs duty on gold and silver, exclusion of diamond sector from 2 per cent equalisation level and simplifying taxation rules in Special Notified Zones (SNZ) for rough diamonds will provide a leadership position to the Indian gems and jewellery industry.”

Source: Idex

India’s Rough Imports Rise Despite Supply Freeze

India saw a slump in polished-diamond exports but an increase in rough imports in October as global demand remained slow and manufacturers brought goods into the country ahead of a two-month shipment freeze.

Polished exports fell 33% year on year to $1.26 billion, the Gem & Jewellery Export Promotion Council (GJEPC) reported earlier this month. Inbound rough shipments rose 9% to $1.02 billion despite a two-month voluntary pause on imports aimed at reducing inventories. The policy came into effect on October 15.

A decline in rough prices ahead of the optional freeze and the Diwali holiday created an opportunity for Indian companies to buy, added GJEPC chairman Vipul Shah.

Sources: Gem & Jewellery Export Promotion Council, Rapaport archives

About the data: India, the world’s largest diamond-cutting center, is a net importer of rough and a net exporter of polished. As such, net polished exports — representing polished exports minus polished imports — will usually be a positive number. Net rough imports — calculated as rough imports minus rough exports — will also generally be in surplus. The net diamond account is total rough and polished exports minus total imports. It is India’s diamond trade balance, and shows the added value the nation creates by manufacturing rough into polished.

Source: Diamonds.net

India’s Titan Company Buys Out CaratLane for $557M

Indian jewelry giant Titan Company will up its stake in e-tailer CaratLane to 98%, acquiring the share it didn’t already own for INR 46.21 billion ($557.2 million).

Titan, which already owns 71% of the online jewelry retailer, plans to buy an additional 27% in an all-cash deal, it said Saturday in a notice to the Bombay Stock Exchange (BSE). It intends to complete the buyout by October 31, subject to requisite approvals.

The deal values CaratLane at INR 170.01 billion ($2.05 billion), according to Rapaport calculations.

Incorporated in 2007, CaratLane operates in India and in the US through a local subsidiary. Titan first took a stake in the business in 2016.

Source: Diamonds.net

The world’s largest office building is filled with diamonds

A new office building in India’s diamond city Surat in Gujarat, where 90% of the world’s diamonds are manufactured has surpassed the Pentagon as the largest structure of the kind.

Built over 7.1 million square feet of floor space, the Surat Diamond Bourse (SDB) has a big leg up on the 6.5 million square feet headquarters building of the US department of defense in Arlington, Virginia. The Pentagon was the world’s largest building for 80 years before it got dethroned.

The 15-story structure, featuring a succession of nine rectangular structures spilling out from a central “spine,” cost a whopping 32-billion-rupee ($388 million) to develop and build.

Indian architecture firm Morphogenesis stopped and started construction over four years because over pandemic-related delays. The building is finally due to open its doors in November 2023, with prime minister Narendra Modi due to inaugurate it.

Quotable: Narendra Modi lauds Surat Diamond Bourse
“Surat Diamond Bourse showcases the dynamism and growth of Surat’s diamond industry. It is also a testament to India’s entrepreneurial spirit. It will serve as a hub for trade, innovation and collaboration, further boosting our economy and creating employment opportunities.” Prime minister Narendra Modi, who was Gujarat’s chief minister from 2001 to 2014, quote-tweeted a video of the Surat premises yesterday.

Working in the Surat Diamond Bourse, by the digits 4,700 office spaces: Office spaces in the Surat Diamond Bourse, which can also double up as small workshops for cutting and polishing diamonds. The offices were all purchased by diamond companies prior to construction, project CEO Mahesh Gadhavi.

65,000: Diamond professionals, including cutters, polishers and traders, that can work on the premises at a given time. Besides offices, the workers also have access to dining, retail, wellness and conference facilities

9: Number of 1.5-acre courtyards with seating and water features that can serve as casual meeting places for traders

131: Number of elevators on the premises

7 minutes: The maximum amount of time it takes to reach any office from any of the building’s entry gates, according to Sonali Rastogi, co-founder of the Indian architecture firm Morphogenesis that designed the behemoth building. In a democratic move, the offices were assigned to business via a lottery system

3 times: How much bigger SDB is compared its counterpart in Mumbai, Bharat Diamond Burse (BDB)

400: The small number of merchants that were willing to move in during the touted November 2022 opening, which led to the opening being postponed. Mumbai’s Palanpuri diamantaires are staying put because they do not want to incur establishment cost, transport cost, and take on overheads of maintenance when the trading business is struggling.

Source: qz.com

World Record Ring made of 50,907 Recycled Diamonds

Jewelers in India have shattered a world record with a ring made of 50,907 diamonds.

The Eutierria Ring has more than twice as many diamonds as the previous record holder, The Touch of Ami, with 24,679 diamonds. Both rings were made in India.

The new ring, created by H.K. Designs and Hari Krishna Exports, was certified last month by Guinness World Records as the ring with the most diamonds.

The ring took nine months to design and make, entirely of recycled materials – 460.55 grams of gold and 130.19 carats of diamonds all re-purposed from customer returns.

It is designed as a sunflower with four layers of petals, a shank, two diamond discs, and a butterfly.

It has been certified by IGI and has a retail value of $785,645, according to a press release issued jointly by both companies.

It takes its name, Eutierria, from a term describing a positive feeling of oneness with the earth.

Spurce: IDEX

Majhgawan-Panna, India’s Only Mine, to Resume Operations

India’s only diamond mine will put up to 84,000 carats a year

Majhgawan-Panna, India’s only diamond mine which was shot down at the end of 2020, will resume production in July 2023 “with a forecast output of up to 84,000 carats a year,” IDEX Online reports.

Majhgawan-Panna, located near the town of Panna in Madhya Pradesh, was closed after environmental clearances “lapsed following concerns from the nearby Panna Tiger Reserve.” Despite this, the National Mineral Development Corporation (NMDC), India’s biggest iron ore merchant miner, plans to resume work there.

According to the report, repeated concerns by the National Wildlife Board has caused mining at the mine to halt “stopped several times over the last 50 years.” In FY2021, the mine produced 13,681 carats.

Source: israelidiamond

20,000 jobs lost in Surat as diamond demand fades

Plummeting demand for cut and polished diamonds in the West and China has pushed some 20,000 workers out of work in the last one month in Surat, where 80% of the diamonds sold globally are polished.

Surat, the main centre of India’s diamond industry, offers employment to some 800,000 workers in its 4,000-odd cutting and polishing units. But work has been drying up, forcing the units to work at 60-70% capacity, said Damji Mavani, secretary of Surat Diamond Association (SDA). It also means fewer workers are needed.

“Fear is looming large in the diamond city of Surat whether the recession of 2008 will be repeated this year too,” said Bhavesh Tank, vice president of Diamond Workers Union, Gujarat. “Orders are fewer and so the workload is less. Therefore, the units are reducing workforce. Some units are cutting down work days so that they do not have to pay the workers on days when they are not working.”

According to Tank, nearly 20,000 diamond workers in Surat have lost jobs in the last one month.

The US is the biggest market for cut and polished diamonds, followed by China.

India’s diamond exports began slowing in November last year. According to data from the Gem & Jewellery Export Promotion Council (GJEPC), overall gross exports of cut and polished diamonds in the April to November period of FY23 declined by 5.43% from the year-ago period.

Another reason is the dropping price of the polished pieces. While the price of rough diamonds continues to be high, that of the polished ones have softened due to low demand, which is impacting the margins of diamantaires and forcing them to reduce workforce.

Mavani of SDA said the workers who have lost their jobs will find work in other areas. “There is a 30% vacancy in most of the factories,” he said.

However, there’s an air of uncertainty in Surat due to the fear of recession in the US, Europe and China. “We do not know when the situation will improve. It may take one year for a robust uptick in demand from overseas markets,” the SDA secretary said.

“With the pandemic in China making a comeback and there are no signs of respite from the war between Russia and Ukraine, inflation soaring in some parts of the world, we are out there for some tough times,” said Vipul Shah, chairman, GJE ..

Shah said the drop in price of polished diamond is eating into the margins of traders.

Traders said business in polished diamonds is also sluggish because of the seasonal lull, lingering economic uncertainty, and the slowdown in China. Although China eased its Covid-19 lockdowns last month, another outbreak stifled the recovery ahead of their Lunar New Year.

Source: economictimes.indiatimes

India Warns of Impact from Proposed US Tariffs

India’s jewelry industry could lose business to rivals such as China and Mexico if the US goes ahead with its proposed new tariffs on the sector, industry leaders warned this week.

Fresh import duties would jeopardize jobs and the well-being of the industry in both India and America, officials from the southern Asian nation said Monday in a meeting with the US Trade Representative (USTR).

The calls come after the USTR threatened to levy punitive tariffs of up to 25% on 17 jewelry categories originating in India, as well as on certain goods from other countries. The action, which it announced in March, was a response to e-commerce taxes in those jurisdictions that targeted online retailers. The proposed tax excludes loose diamonds.

Around 140 members of the Indian trade submitted petitions against the move before the April 30 deadline, the Gem & Jewellery Export Promotion Council (GJEPC) said Tuesday. The USTR allowed a panel of industry representatives to present comments at the virtual meeting.

Leading the delegation, GJEPC chairman Colin Shah argued that India had already seen a decline in gold-jewelry exports to the US after losing its preferential trade status with the US around 15 years ago. The latest move would exacerbate the situation, he insisted.

“Further [duties] on jewelry will accelerate that drop, and the beneficiaries will be China and Mexico,” Shah told USTR officials.

While Indian jobs would shift to other countries, US jewelry companies would miss out on the long credit and memo facilities that Indian suppliers offer, Shah added. In addition, India jewelry companies operate an estimated 500 offices across the US, employing thousands of locals, he asserted.

India’s exports of gold jewelry to America fell 22% from $1.9 billion in 2007 to $1.49 billion in 2019, according to a report the GJEPC released in March.

Source: Diamonds.net

India Says Slump in Diamond Exports Is Much Worse Than 2008

Diamond exports from India, which polishes about 90% of the world’s rough diamonds, will collapse by as much as a quarter this year as the pandemic crushes demand and breaks supply chains.

Overseas sales of cut and polished diamonds may slump 20% to 25% in the year ending March from $18.66 billion last year, according to Colin Shah, chairman of the Gem & Jewellery Export Promotion Council. That will push exports to the lowest in data going back to the 2009 fiscal year on the association’s website.

“In 2008, things were bad for a quarter and business recovered after that,” Shah said in an interview. “This is now two quarters gone.” While festivals such as Diwali, Christmas and Valentine’s Day will prop up demand in the next six months, that won’t be enough to lift full-year exports, he said.

Losing Luster

India imposed one of the world’s strictest lockdowns in March to contain the coronavirus outbreak. That brought activity to a halt and put the economy on course for its first annual contraction in more than four decades. With more than 7 million infections, the country is one of the world’s virus hot spots.

The measures to control the pandemic meant production centers were closed or operating at very low levels, and rough-diamond imports fell in line with poor end-product demand. The country’s diamond exports sank 37% to $5.5 billion in the six months through September from the year-earlier period.

Workers have now started returning to the diamond-polishing hubs of Surat, Mumbai and Kolkata, and factories are operating at 70% to 80% of capacity with social-distancing norms in place, Shah said. Still, it’s difficult to predict global supply chains as rules to control the virus change frequently, he said.

Uneven Recovery

The International Monetary Fund warned this week the world economy faces an uneven recovery until the virus is tamed. Chinese consumers are starting to spend again, while in Europe, the luxury sector is back near pre-pandemic levels despite a surge in Covid-19 cases that’s hurting normal tourism.

De Beers sold about $467 million of rough diamonds in its eighth sales cycle of 2020, Anglo American Plc said Wednesday. Sales improved compared with $334 million in the previous cycle, and $297 million during the same cycle in 2019.

“We continue to see a steady improvement in demand for rough diamonds in the eighth sales cycle of the year, with cutters and polishers increasing their purchases,” said Bruce Cleaver, chief executive officer of De Beers. “But these are still early days and there is a long way to go before we can be sure of a sustained recovery in trading conditions.”

Source: bloomberg

India Extends Deadline for Duty-Free Reimports

The Indian government has granted diamond companies extra time to ship polished goods back to the country without incurring customs duty.

At present, reimports are subject to the 7.5% levy once the diamonds have been outside India for three months. The Central Board of Indirect Taxes and Customs (CBIC) has extended the deadline by a further three months for all parcels for which the cutoff date was previously between February 1 and July 31, it said Friday.

The country’s Gem & Jewellery Export Promotion Council (GJEPC) had been lobbying for the change after the Covid-19 pandemic delayed the return of goods companies had sent overseas for grading and other services.

“The latest notification on the extension of three months on reimport of certified diamonds is a great respite for our exporters,” said GJEPC chairman Colin Shah.

Last week, the council urged the government to reduce customs duty on polished to 2.5%, arguing that the move would boost India’s status as a hub for trading and distribution of diamonds.

Source: Diamonds.net