- Sunday, April 28, 2024
Russia is the world’s biggest producer of rough diamonds by volume with a 30 per cent share of the market
By: Eastern Eye
INDIA, home to 90 per cent of the world’s diamond cutting and polishing industry, and De Beers, the top global rough diamonds producer by value, are seeking clarity and flexibility from G7 countries in implementing a ban on the import of Russian gems.
The G7 countries last Wednesday (6) announced a direct ban on Russian diamonds starting from January 1, followed by phased-in restrictions on indirect imports of Russian gems from around March 1.
Russia is the world’s biggest producer of rough diamonds by volume with a 30 per cent share of the market.
The implementation will depend heavily on India, which wants to minimise potential disruptions for small diamond firms.
“We are not happy with the announced timeline for implementation of restrictions,” said Vipul Shah, chairman of the Gem Jewellery Export Promotion Council (GJEPC), a leading Indian trade body.
“Recognising the diversity of our industry, we believe there should be more flexibility in these timelines,” he said.
The G7’s plan has sparked a debate as it risks complicating supply chains when demand is under pressure. India’s April-October polished diamond exports were reduced 29 per cent to $10 billion (£8bn).
“The G7 is essentially saying it is still a work in progress but here is a framework with a timeline,” diamond analyst Paul Zimnisky said.
But “if Indian companies want to continue doing business with the G7 nations, then they are going to have to do their part”, Zimnisky added.
The G7 plans to introduce a traceabilitybased verification for rough diamonds by September. However, two questions remain unsolved – how should a diamond’s country of origin be checked and where should it be done.
Belgium supports the idea of checks in Antwerp, the world’s main diamond hub. Some in the industry are concerned this would create supply chain bottlenecks, additional costs and hamper African production’s access to the G7 markets.
“It is currently unclear what exactly will be involved at each stage, so we will seek clarification before being able to consider impacts,” De Beers, a unit of Anglo American, said. “If the intent is to apply a purely technological certification system and to channel all rough imports to the G7 through Belgium, this will be to the detriment of responsible African producers, to all those who depend on the artisanal mining sector, and to the wider industry.”
