India’s exports of polished diamonds suffered yet another big fall in September, down 22.9 per cent, according to the latest figures from the GJEPC (Gem and Jewellery Export Promotion Council).
That’s a marginally better performance than August, when year-on-year exports were down by 23.8 per cent. Between April and September total foreign sales fell 20.6 per cent (all figures in US dollars).
Actual monthly sales tell a different story from year-on-year decreases. Total foreign sales for September were $1.29bn, compared to $1.04bn in August and $908m in July.
Across the whole gems and jewelry industry in India, gross exports were $2.54bn, down 15.9 per cent year-on-year (compared to 22.9 per cent for polished diamonds).
Exports of polished lab growns – still a tiny minority of all diamond sales – were down 16.5 per cent to $111m.
The Indian government is facing calls to adopt US guidelines to distinguish lab growns from natural diamonds.
The 10,000-member GJEPC (Gems and Jewellery Export Promotion Council) says there is widespread confusion in the way diamonds are marketed and advertised.
It says India should adopt the US Federal Trade Commission (FTC) guidelines, which say there must be a “clear and conspicuous” indicating that a diamond is man-made.
They also say the term “diamond” without qualification can only be used to refer to a natural, mined diamond.
And lab growns cannot be described as “real,” “genuine,” “natural,” or “precious” without additional qualifying language.
The GJEPC has written to India’s Department of Consumer Affairs calling for strict rules to differentiate between natural and lab grown.
“The absence of standardised guidelines on diamond terminology leads to ambiguity,” it says.
“And there are no mandatory disclosure requirements to indicate whether a diamond is lab-grown or natural to the consumer.”
The near-empty Surat Diamond Bourse (SDB) is hoping the arrival of around 40 lab grown traders will signal a change in its fortunes.
The vast new center, recognized by Guinness World Records as the largest office building in existence, was officially opened last December by India’s prime minister Narendra Modi .
It has a capacity of 4,500 offices, but remains virtually empty.
The bourse has, according to local media reports, now reached an agreement with the Lab Grown Diamond Association (LGDA) to relocate around 40 lab grown companies from elsewhere in Surat.
Mahesh Gadhvi, CEO at SDB, said recently that 250 offices were currently occupied (that’s less than 6 per cent of the total).
“Steadily we are progressing towards opening more offices and starting more businesses from SDB,” he told the business news channel CNBC.
India’s exports of polished diamonds fell by 23.8 per cent year-on-year in August, according to the latest figures from the GJEPC (Gem and Jewellery Export Promotion Council).
Total foreign sales were $1.04bn, compared to $1.36bn last August. Exports in July were $908m, down 22.7 per cent.
Polished diamond exports have fallen every month this year, down 20 per cent in January, 28 per cent in February, 27 per cent in March, 17 per cent in April, 15 per cent in May and 26 per cent in June. All figures are for US dollars.
Gross exports of all gems and jewelry fell by 18.8 per cent during August – a slower rate of decline than diamonds – to $2.01bn.
Rough imports for the April to August period were down 22.6 per cent to $4.98bn.
Russian exports of rough diamonds to India increased by well over a fifth, to 4.1m carats, during the first six months of the G7 sanctions.
Total sales were up by 22.23 per cent for January to June 2024, according to the Indian Ministry of Commerce and Industry. But revenue fell by 15.22 per cent, as prices keep declining, from $614m to $520m.
Russian exports for June alone were 347,620 carats, an increase of almost 32 per cent on the same month last year.
The G7 and EU nations imposed sanctions on all Russian diamonds of 1.0-cts and above, regardless of where they were cut and polished, from 1 January. The threshold was lowered to 0.50-cts and above from 1 September.
Rough diamonds imported from Russia to India can only be sold to markets beyond the G7 and EU.
India’s diamond industry has been calling on the government to allow direct payments to Russia so it can more easily buy sanctioned goods.
India’s exports of polished diamonds suffered another hefty drop in June, down 26 per cent year-on-year to $1.02bn.
Foreign sales in May were down by almost 15 per cent to $1.47bn, according to new figures from the GJEPC (Gem and Jewellery Export Promotion Council).
Polished diamond exports have fallen every month this year, down 20 per cent in January, 28 per cent in February, 27 per cent in March and 17 per cent in April.
Gross imports of rough diamonds for April to June dropped by 15 per cent by value to $3.39bn and 6 per cent by volume.
Overall exports of all gems and jewelry declined by 15 per cent in June to $1.9bn.
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.”
Police investigating the theft of CAN$20m (US$14.5m) of gold from Toronto Pearson Airport last April – the biggest heist of its kind in Canada – say much of it ended up in Dubai or India.
The perpetrators used a fraudulent airway bill (carrier’s document of instruction) for shipment of seafood to dupe Air Canada Cargo warehouse staff, then used a forklift truck to empty a container packed with 6,600 gold bars, as well as foreign currency.
“We believe a large portion has gone overseas to markets that are flush with gold,” said lead investigator Det. Sgt. Mike Mavity, as reported by CBC News, Canada’s national broadcaster.
“That would be Dubai, or India, where you can take gold with serial numbers on it and they will still honour it and melt it down. And we believe that happened very shortly after the incident.”
Police have arrested nine men in connection with the case and are searching for three others involved in what is believed to have been an “inside job”.
They say the Project 24 Karat investigation has cost CAN$5.3m so far (US$3.9m) and could end up costing CAN$ 10m (US$7.3m).
India’s exports of polished diamonds suffered a further drop in May, down by almost 15 per cent to $1.47bn.
But the year-on-year rate of decline shows some signs of slowing, according to new figures from the GJEPC (Gem and Jewellery Export Promotion Council).
It fell 20 per cent in January, 28 per cent in February, 27 per cent in March and 17 per cent in April.
Diamonds are faring significantly less well than India’s overall gems and jewelry sector, which saw revenue for April slip by 6 per cent to $2.48bn.
Manufacturers bought more diamonds year-on-year in April and May (up almost 2 per cent by volume) but the price slump means imports are down almost 10 per cent by value are down by almost 10 per cent to $2.39bn.
A passenger at an airport in India was caught with almost 1kg (2.2lbs) of gold, most of it concealed inside their body.
They were intercepted at Bir Tikendrajit International Airport, Imphal, in the northeastern state of Manipur, after a specific tip-off.
Customs officers recovered one packet of gold, in a paste form, within the airport complex, and found two more hidden inside the passenger’s body after a thorough examination.
The gold packets were shaped like eggs, wrapped in rubber sheaths and were found hidden inside the passenger’s rectum.
The passenger has not been identified, and Customs did not say where they’d traveled from.
The total weight of the gold was 972.28 grams, with a market value of Rs 70,31,601 ($84,000).
India will lead demand for natural diamonds in 2024, says David Kellie, CEO of Natural Diamond Council (NDC), as US buyers increasingly switch to lab grown.
“The Indian market remains the strongest growth market in the world because of its strong financial position and changing demographics,” he told The Economic Times, in India.
“Indian women are now financially stronger, and they are driving the demand. The key economic indicators in the US are not yet favourable for a demand recovery in diamond purchase.”
Kellie (pictured) predicts a polarization between the natural and lab grown markets, with a price difference currently at 80 per cent to 90 per cent.
Natural diamonds will become increasingly rare, he said, with no new mines in prospect, and with miners digging deeper, and spending more, to reach remaining deposits.
India has urged the Group of Seven (G7) countries to delay an incoming ban on Russian diamonds because the rules to trace the origins of gems remain unclear, two sources aware of the matter said.
India, home to 90% of the world’s diamond cutting and polishing industry, is critical to the implementation of the ban.
New Delhi has also sought more clarity in its talks with G7 leaders, said the sources, who did not wish to be identified because they are not authorised to talk to the media.
Earlier this month, G7 nations announced a direct ban on Russian diamonds starting Jan. 1, followed by phased-in restrictions on indirect imports of Russian gems from around March 1. A new system to trace the origin of the gems will be introduced in September.
Russia is the world’s biggest producer of rough diamonds by volume. New restrictions on the trade of Russian gems are part of the bloc’s broader measures designed to limit Moscow’s revenues that aid and fund its invasion of Ukraine.
“The timeline to start restrictions on indirect imports from Russia in three-four months is impractical, as the rules on how the origin for a gem will be traced are not clear,” one of the sources said.
India has also expressed its reservations over G7’s new “traceability-based verification and certification” system, which may require sharing of data about Indian businesses, the first source said.
Some data might be sensitive and businesses might not be comfortable with sharing such information, he said.
The federal trade ministry, which is involved in talks with G7 on proposed restrictions, did not immediately respond to a request for comment.
India mostly processes smaller Russian diamonds, and that’s why the country expects minimal trade disruption, a government official said earlier this month.
Still, the proposed ban would impact the diamond supply chain, industry officials say.
India’s diamond sector already faces weaker demand. The country’s polished diamond exports fell 29% to $10 billion during the first seven months of the current fiscal year that began in April.
It exported polished diamonds worth more than $22 billion last fiscal year that ended on March 31. The industry, based mainly in the western state of Gujarat, employs millions of people across small and medium firms.
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.
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.
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.
The US has reportedly blocked $26m of payments made by Indian businesses attempting to buy rough diamonds from Russia.
OFAC, the Office of Foreign Assets Control, is said to have instructed banks in recent months to halt the transfer of funds, mostly from UAE subsidiaries of Indian companies.
Neither India nor the UAE has sanctioned rough diamonds from Russia. The US has, although its ban does not apply to diamonds cut and polished outside Russia.
Leaders of the G7 nations concluded their summit in Hiroshima, Japan, in May without the clear mandate to fully sanction Russian diamonds that many had expected.
The US is believed to have halted the bank transfers over suspicions they were being made to sanctioned entities in Russia, but industry representatives in India insist otherwise.
The Gem & Jewellery Export Promotion Council (GJEPC) is lobbying the Indian Ministry of Commerce and the Indian embassy in the UAE to resolve matters.
Vipul Shah, chairman of the Gem and Jewellery Export Promotion Council (GJEPC), told Economic Times: “We are trying to explain to OFAC that the payments were made to non-sanctioned entities and even to some Russian entities well before the sanctions came into place. There is very little direct import of diamonds from Russia.”
The $26m of blocked purchases represent only a small proportion of the average $1.3bn of rough a month that India has been importing from all sources (GJEPC figures for April to June).
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.
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.
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.
Rough diamond prices have increased by 10-15 per cent in the last one and half months amid a supply crunch due to US sanctions on Russia’s Alrosa, said Bakul Gajera, who works with Surat-based Laxmi Diamond, a leading polisher.
The diamond industry in Surat, Gujarat, is preparing for flat domestic and international demand as raw material prices rise and “recessionary trends” build in the west.
