Russia war fallout may hurt Indian diamond exports
MUMBAI : The Indian diamond trade, which produces nine out of 10 of the world’s polished diamonds and employs over 4 million, could face collateral damage from the Russian war. The Group of Seven (G7) nations, an informal bloc of advanced democracies led by the US, is threatening to halt the imports of certain grades of polished diamonds from India that use rough diamonds indirectly sourced from Russia.
Though the G7 hasn’t yet sanctioned Russian diamonds cut and polished outside that country, the bloc is working on restricting their use to cut Russian revenues. The action forms part of the punitive economic sanctions imposed by the bloc against Russia, which invaded Ukraine in February last year.
Representatives from the bloc have been negotiating with officials from apex trade body and commerce ministry sponsored Gem & Jewellery Export Promotion Council (GJEPC), Bharat Diamond Bourse (BDB) and Surat Diamond Bourse, among others, for the past three months on the issue. The Indian side is urging the G7 to prevent any such ban, given the deleterious impact it could have on over 4 million people directly employed in India’s diamond cutting and polishing trade.
However, a top trade source, who has been part of the negotiations, told Mint that the G7 could consider a ban on exports of stones of one carat and above, to begin with. “If there is a ban on imports into the G7, we are hoping it is only on polished diamonds of 1 carat and above and not on smaller stones over which India enjoys a monopoly on cutting and polishing, as that could have a direct bearing on smaller diamantaires and the labour they employ for processing roughs," the source said, requesting anonymity.
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