India is the world’s largest manufacturer of diamonds, is taking steps to move insistently into the procurement of roughs by setting up its own syndicates. Over 120 years after De Beers, the global diamond group, set up its own middle selling organisation, India’s diamond city of Surat, which cuts and polishes nine out of 11 of the world’s diamonds, is seeking to assurance its own supply of the raw material. Surat Diamond Sourcing India has been recognized to source diamonds directly from mining firms across the globe.
For five decades Indian diamond industry players in have been buying roughs at sale at major global trading hubs such as Belgium and Israel. Antwerp, where 80 per cent of all rough diamonds and 50 per cent of all cut diamonds are handled, is where more than half of Surat’s diamonds are bought at auction while the rest are sourced from major diamond companies.
India has had strong links with De Beers, Alrosa, the Russian diamond producer, and BHP Billiton, the resources group, who all act as middlemen.
Four years after Diamond India Limited was set up to unify India’s 58 most important diamond and jewellery manufacturers and exporters, Surat Diamond Sourcing India has been set up as a consortium of 500 small, medium and large units out of the 4,500 in service in the city.
With an initial capital of around $220m in its reach, the company has decided to source rough stones directly from mines in Africa, Russia, Canada and Australia. While larger manufacturers and dealers have put $230,000 each into the kitty, smaller companies have invested around $115,000.
India currently controls around 85 per cent of global volumes and 70 per cent of value and it is hoped that the move will broaden India’s influence over the industry. But as India tries to assert its nationalistic authority on a world stage, it doesn’t look like there will be any significant power shift away from the big players.
India’s export share in the world market is estimated to double by 2015 from its current level of 20 per cent, as a result of high demand from China, Hong Kong and regions such as the Middle East, South East Africa, the US and Canada, which are home to huge records of the Indian diaspora.
