For Thousands of Diamond Traders, A New Bourse in Surat Promises to Add to the Shine

India’s $23 billion diamond industry accounts for over one-third of its gems and jewellery trade, making up seven percent of the country’s Gross Domestic Product (GDP). India’s exports of cut and polished diamonds, gold jewellery, and gem stones, are predicted to grow 10 per cent year-on-year in FY19 according to the Gems and Jewellery Export Promotion Council (GJEPC). The diamond is quite literally the ‘crown jewel’ of all gemstones. Close to 90% of the worlds diamonds pass through Gujarat for polishing, making the Indian state a pivotal member of the diamond supply chain.

The diamond industry of India traces its roots to the 1960s when some entrepreneurs belonging to the Patel community of Saurashtra began importing rough diamonds, which were then polished and exported. Post the 1980s, the industry grew rapidly due to close proximity to the financial capital, Mumbai, and eventually resulted in the emergence of many such business communities from Saurashtra and Gujarat that helped the diamond industry of Surat prosper. The market-oriented economic reforms in 1990s gave rise to a new middle class that started buying diamond jewellery alongside traditional gold jewellery. The diamond industry further benefitted from this new and growing consumer base – its own local community.

The diamond industry of India traces its roots to the 1960s when some entrepreneurs belonging to the Patel community of Saurashtra began importing rough diamonds, which were then polished and exported. Post the 1980s, the industry grew rapidly due to close proximity to the financial capital, Mumbai, and eventually resulted in the emergence of many such business communities from Saurashtra and Gujarat that helped the diamond industry of Surat prosper. The market-oriented economic reforms in 1990s gave rise to a new middle class that started buying diamond jewellery alongside traditional gold jewellery. The diamond industry further benefitted from this new and growing consumer base – its own local community.

Today, India gives shine to 75% of the rough diamonds sold globally, with Surat being the capital of this trade. Over 90% of the world’s diamond pieces are cut in Surat, contributing to about 80% of the Indian annual diamond export. The industry also employs more than seven lakh people with the majority of them based in Surat. However, the Bharat Diamond Bourse (BDB), located in Bandra Kurla Complex, Mumbai, serves as the sole diamond trading hub for India. Most of the traders and merchants conduct business from the BDB. Diamond merchants from Surat travel to Mumbai daily to conduct business. In order to reach the BDB, many merchants take the early morning train from Surat and return late into the night after a hard day’s work, leaving them with no time for familial and societal commitments. Whilst Surat is well-known for its diamond manufacturing sector and is home to many of the largest polishing factories, the city does not have a well-structured trading base.

Courtesy: Economic Times