India Moves Ahead to Become a Global Diamond Trading Hub

Mumbai: Its India now that has taken a final leap to rule over the global diamond industry by establishing a Special Notified Zone (SNZ) and thereby providing a stage to international miners where they can keep their goods for viewing and conduct auction.

India’s Foreign Policy declared last month has mentioned that two SNZs would be created; one in Bharat Diamond Bourse (BDB), Mumbai and the second in Surat where global mining companies like De Beers, Alrosa, Rio Tinto etc. would be allowed to directly sell their rough to diamond companies in India.

Now the government has set up a Special Purpose Vehicle viz. India Diamond Trading Centre (IDTC) to handle import of rough diamond for auctions and sale here. It has proposed BDB to outsource the handling of rough diamond, imported for auctions or sales to IDTC to be constituted jointly by the Gem & Jewellery Export Promotion Council (GJEPC) and BDB. The authorities of BDB have identified 4000 square feet with 10-12 rooms where diamond trading would be conducted from the 1st July, 2015.

The SNZ shall provide facilities (including all necessary commercial, security and customs related facilities incidental to these activities) for the receipt, storing and viewing of imported rough, in addition to auctions and sales. The BDB is required to submit the floor plan, proposed facilities, including security related features (to ensure transparency in the deals and also keeping in mind safety issues), for approval to the Commissioner of Customs.

Earlier, all the diamond manufacturers in India had to travel to China, Antwerp, Israel, the UAE etc., to procure rough diamonds as the goods weren’t allowed to come directly to India. 21 companies have been approved by the Reserve Bank of India (RBI) to participate in consigning rough diamonds at the SNZ. According to a circular issued by Central Board of Excise and Customs (CBEC), import of rough diamonds would be permitted through air cargo only, no imports through hand-carriage or express courier services would be allowed. Besides, all the imported rough diamonds being imported would require to be certified by the Kimberley Process (KP).

The IDTC will be entrusted to log and monitor the carat weight with the import invoice, packing list and KP certificates. Thereafter, the parcel will be sealed and transferred to the strong room at the SNZ. The SNZ will be accessible to traders for viewing goods and any auctions and/or sales that take place. The GJEPC shall define the eligibility conditions for visitors, as guided by Customs rules. All persons permitted to visit the SNZ shall be issued a photo identity card by India Diamond Trading Centre.

Mr. Sabyasachi Ray, Executive Director, GJEPC says, “With operational guidelines in place, global miners will be able to set up offices in India which will reduce travelling time for Indian diamantaires, and also cost of rough diamond procurement.”

The move assumes a lot of significance especially for Indian diamantaires who currently have to travel to major trading centers like Dubai, Johannesburg and Antwerp once for inspection of the lot of rough diamond and again for participating in auctions.

“This is the first of its kind of revolutionary idea which the government of Israel and others want to replicate. We were pursing with the government for several years for this. The guidelines will transform India into the world class trading center not only for rough diamond but also for other commodities, in case the same is adopted,” Mr. Ray comments.

India which claims to process 14 out of 15 roughs is already enjoying dominance over the global diamond manufacturing industry. But now the SNZ would certainly provide a platform to India from where it can proceed in establishing its position as a global diamond trading hub in near future.