Indian Diamond Industry Supports Government Decision In Latest Lockdown

As per the latest notice issued by the government of Maharashtra on April 4, 2021 due to rapid spread of Covid19 the government announced lockdown across the State. This came into effect from April 5, 2021. Bharat Diamond Bourse was asked to remain closed till further notice.Members were requested to take out their important documents and valuables on April 5 itself.

This move comes at a time when export orders are flooding G & J business in India. According to Mehul Shah, Vice President, BDB: “Diamond is an export-based industry, only manufacturing is done in India. Bharat Diamond Bourse is a bridge between manufacturing and exports. Presently, manufacturing and exports are allowed but in between, the diamond offices are not allowed to operate. Diamond offices are mainly located in BDB, also custom house is located in BDB. If the bridge between manufacturing and exports is not working then, both manufacturing as well export will suffer, resulting loss of man power as well forex. One the other hand Surat in Gujarat  is working at 100 per cent capacity. Lot of diamond business has been diverted to Gujarat. We have already taken up with the Maharashtra government and requested them to permit BDB to work for exports in restricted capacity, waiting for a positive response.”

The world has been reeling under the Covid crisis for over a year now, different countries across the globe have dealt with the situation in different ways.

Governments usually follow past experience which has proven that total lockdown helps control Covid – but at present the State government has asked only business centres to shutdown while the public is moving about freely, using public transport systems – where one sees a lot of proximity between the members of the public.

All the same, the current step announced by the state government is surely crippling diamond export. Says Dinesh Lakhani, Kiran GemsPvt Ltd, “BDB representatives are meeting government officials in order to understand the details of the lockdown. They are also requesting if some members, who have active exports to be completed within a stipulated time can work with minimum staff strength and maximum safety protocols in place. But till there is a consensus with government officials on this matter nothing can be said. We have to wait and watch and remain careful.” As a result many companies have been forced to move inventory to their Surat offices to ensure unstinted business activities.

There’s some hope, however, that the situation may be resolved in the near future till then the industry will have to adhere to government norms. “The decision of a lockdown is taken keeping in mind the soaring number of Covid cases in our country especially in Mumbai.We as a company completely are in support of BDB and GJEPC decision of keeping the office premises shut as I am sure they have done the required analysis and arrived at this decision.However, our industry is heavily export driven therefore shipments and customs related departments should be kept open to keep the momentum going.I am sure we all will come up with an amicable decision which allows the industry to thrive and ensure safety of all the people,” opines Nilesh Chhabria, Finestar.

The way Corona is spreading in Mumbai, a strict action was required. But considering that the world is open and thus demand for diamonds and jewellery is ongoing, government needs to give some relief to this export oriented industry. “Our two associations GJEPC and BDB are in talks with the Govt for the same and I am sure some relief in way of 20  per cent staff allowance in the office will come,”says Ankit Shah, Ankit Gems.

The city is indeed facing a Catch-22 situation where health and life of the masses is at stake, while financial prudence asserts that government cannot overlook commercial aspect totally as the public debt will escalate beyond control. “There is no doubt there is a huge surge in Covid cases and worse than before but we need to keep the economy going. Shutting business will not help anyone as many people and companies survive on daily basis. When it comes to diamond business, shutting down will hurt us in a big way. Covid somehow was a blessing for our industry as many other pleasure activitieswere unavailable to the masses -- like travel, entertainment, eating out and so the money was spent on luxury productslike jewellery.  By lockdown of business houses, we will be losing demand and the opportunity of exporting jewellery.  We know that US will give another stimulus and that money will be spent on jewellery.  As marketsare closed, the finished products will not be delivered in time and retail customer who is eager to spend money on jewellery may spend it on some other luxury product.We should be operating with required staff to ensure smooth flow of finished product reaching the store. Currently, we will have a tough time delivering finished products as diamonds may not reach the factory in time,” explains Sanjay Shah, Goldstar Jewellery.

Most diamond business houses in the city are in full support of this lockdown.Even last year diamond traders had experienced that they didn’t have to face substantial business losses due to lock down. “The market has enough demand. There is no hurry in selling the inventory. And there is no worryabout fall in prices, if you can’t sell now. So overall at the moment, it will be a wiser decision to support the government initiative to win over this pandemic. And I have full confidence in the BDB and GJEPC, that they will plan something in few days and think about an option of atleast conducting exports again,” says Rajesh Shah, Venus Jewel.This lockdown will weigh heavily on small traders, brokers and mid-sized diamond companies as they cannot operate without an office and as physical markets across the world are open and Mumbai offices are closed.

There has to be a balance between the two crises in order to minimize losses of both life and wealth. Says Piyush Patel, Dharmanandan Diamonds Pvt Ltd, “We are always with the government and diamond industry. But I strongly believe 100 per cent closure is not the solution.BDB & GJEPC should step forward, there should be some way to deal with the current situation where we control covid as well as conduct business. At least 25 to 30 per cent staff should be allowed to fulfill export requirements and gradually staff attendance can increase as things are more under control.”

So at present, diamond traders will have to wait and watch and possibly think of some ways to overcome this situation.