China challenges India's polished diamond throne
(Minews) - India's long-held position as the world's top diamond polisher is being challenged by soaring output from China, compelling the south Asian country to seek help from ally and top rough diamond supplier Russia to defend its market share.
India has traditionally relied on the middlemen in trading hubs of Antwerp, Tel Aviv and Dubai for its supply of rough diamonds, which mainly come from Russia or Africa. Most of the world's diamond output is sent to India for cutting and polishing before being retailed around the world.
But China has managed to break the established trade route by getting diamonds directly from African mines in which Chinese companies have a stake. This has boosted the value of China's net exports of polished diamonds by 72 percent in the past five years to $8.9 billion.
While India's exports, supplied by firms such as Asian Star , Gitanjali Gems Ltd and Venus Jewel, rose 49 percent to $14 billion over that time, shipments have seen a sharp drop this year.
"China's active procurement of rough supply from African countries was reducing the supply available to Indian manufacturers," said Sandeep Varia, an executive of Indian industry body Assocham. "Many units across the country had to lay off workers due to losses."
As a result, China's share of the global polished diamond market has tripled to 17 percent in the past decade, according to data from the United Nations. India's share has fluctuated between 19 and 31 percent.
Publish date : Saturday 27 December 2014 21:47
Story Code: 18469
