Diamond company defaults on Rs. 400 crore payments

Yet again, default incident from Surat has shaken the diamond industry. A diamond company of Katargram has reportedly defaulted on payments worth Rs. 400 crore, says a report.

Last year, the company had purchased rough diamonds in a big quantity from rough diamond dealers in Mumbai, Surat and Antwerp. More than 90 rough diamond dealers are learnt to have lost their money to the company.

The prices of rough diamonds fell by 9 per cent in the last few months, eroding the profitability for the company. Even prices of polished diamond fell by 22 per cent giving further jerk to the company. The company was into diamond business since two decades. Its owners had split a few years ago from a reputed Diamond Trading Company (DTC) sightholder group based in Katargam, adds a report.

Now, the company has reportedly decided to fulfill the payments using its assets. Diamond World spoke to Dinesh Navadiya, President of Surat Diamond Association regarding the incident. He said “We welcome the company’s decision to give payments using their assets.” He refused to term it as a biggest default of the recent years as reported in the media.