Amreli, Gujarat: Raghavbhai Chengalia, 55, tiptoed barefoot on the dirt road of his farm to avoid the brown mounds of cattle dung, plucking his rolled-up gray pants even higher. Farm work is exhausting, he says, trying to hoist a bundle of cotton onto a cart. He had stopped working on the farm two decades ago when he became a diamond pChengalia thought he had left his farm life in Mangwapar, a village about 15km from Amreli, behind for good, until his factory closed in October and took his job with it. “I have 10 people to feed at home,” he says, explaining why he cannot wait for the factory to reopen. “I have no choice but to return to work here.”
The diamond industry in Gujarat, where about 90% of the world’s diamonds are cut, polished and exported to buyers mostly in the US and Europe, is hurting from the global recession that has caused large-scale layoffs and damaged the economy of the state’s diamond processing centres. The government does not maintain employment records for the industry and it was not possible to ascertain the precise number of people thrown out of work.
India’s diamond exports were valued at Rs82,000 crore in the last fiscal. The Gems and Jewellery Export Promotion Council has reported a 31.62% decline in diamond exports since November 2007. “People have lost their jobs in the US. You can be sure that jewellery is not on the top of their mind right now,” says Vivek Mehta, a diamond expert at Suhashish Diamonds, a trading company with sales of Rs291 crore for the quarter ended June and operations in India, the US, Hong Kong and Botswana.
US retailers J.C. Penney Corp., Inc., Macy’s, Inc. and Bloomingdale’s, Inc. and Amazon.com, Inc. are offering between 30% and 75% discounts on diamonds and jewellery in a bid to attract consumers as rising joblessness deters shoppers.
However, even if these steep discounts do not drive sales, retailers in the US are unlikely to suffer because Indian exporters are paid only after the diamonds are sold, says Pravin Shah, secretary of the Mumbai Diamond Merchants Association. “So, if the retailers cannot sell the diamonds, they will simply return them to us and refuse to pay,” Shah says.
Which is why diamond exporters in India have been watching Christmas and post-Christmas sales closely. “We will get the results early next month... Only then will we know what is really going on in the international market,” says Mehta.
The downturn is, meantime, sending convulsions through manufacturing units in rural Gujarat where these diamonds are actually cut and transformed from rough stones into glittering pieces of jewellery for display in showrooms in wealthy cities of the US and Europe, says Lalit Thummar, president of the Amreli Diamond Association, who is also pursuing a postgraduate degree on the social aspecthttp:// livemint.com/2008/12/28234050/PostChristmas-sales-hold-key.html?h=Bs of Amreli’s diamond industry.olisher in the town of Amreli.
The diamond industry in Gujarat, where about 90% of the world’s diamonds are cut, polished and exported to buyers mostly in the US and Europe, is hurting from the global recession that has caused large-scale layoffs and damaged the economy of the state’s diamond processing centres. The government does not maintain employment records for the industry and it was not possible to ascertain the precise number of people thrown out of work.
India’s diamond exports were valued at Rs82,000 crore in the last fiscal. The Gems and Jewellery Export Promotion Council has reported a 31.62% decline in diamond exports since November 2007. “People have lost their jobs in the US. You can be sure that jewellery is not on the top of their mind right now,” says Vivek Mehta, a diamond expert at Suhashish Diamonds, a trading company with sales of Rs291 crore for the quarter ended June and operations in India, the US, Hong Kong and Botswana.
US retailers J.C. Penney Corp., Inc., Macy’s, Inc. and Bloomingdale’s, Inc. and Amazon.com, Inc. are offering between 30% and 75% discounts on diamonds and jewellery in a bid to attract consumers as rising joblessness deters shoppers.
However, even if these steep discounts do not drive sales, retailers in the US are unlikely to suffer because Indian exporters are paid only after the diamonds are sold, says Pravin Shah, secretary of the Mumbai Diamond Merchants Association. “So, if the retailers cannot sell the diamonds, they will simply return them to us and refuse to pay,” Shah says.
Which is why diamond exporters in India have been watching Christmas and post-Christmas sales closely. “We will get the results early next month... Only then will we know what is really going on in the international market,” says Mehta.
The downturn is, meantime, sending convulsions through manufacturing units in rural Gujarat where these diamonds are actually cut and transformed from rough stones into glittering pieces of jewellery for display in showrooms in wealthy cities of the US and Europe, says Lalit Thummar, president of the Amreli Diamond Association, who is also pursuing a postgraduate degree on the social aspecthttp:// livemint.com/2008/12/28234050/PostChristmas-sales-hold-key.html?h=Bs of Amreli’s diamond industry.olisher in the town of Amreli.
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