Rough Trading to Start in Mumbai from 1st July

Mumbai: The government has finally allowed international mines to sell rough diamonds in India, which otherwise Indian merchants had to earlier purchase from Antwerp.

The Special Notified Zone (SNZ) to allow import and sale of rough diamond directly by global miners like De Beers, Rio Tinto, BHP Billiton and Al Rosa is set to become operational by July 1.

While plans to set up the SNZ were announced at the Bharat Diamond Bourse in December 2014, the government had not issued any operational guidelines in consultation with the Central Excise and Customs. Therefore, despite the announcement, global miners were apprehensive over setting up of India offices to bring rough diamond and conduct auctions here.

De Beers’ Chief Executive Officer Philippe Mellier on his recent India visit had said his company was ready to set up offices in India, provided conducive trading regulations were put in place.

“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,” said Sabyasachi Ray, Executive Director, GJEPC.

The decision assumes significance especially for Indian diamantaires who currently travel to major trading centres like Dubai, Johannesburg and Antwerp once for inspection of the lot of rough diamond and again for participating in auctions. India process 11 out of every 13 rough diamond mined globally.

“This is 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,” said Ray.

Meanwhile, the government has set up a special purpose vehicle —India Diamond Trading Centre (IDTC) — to handle import of rough diamond for auctions and sale here. The government proposed BDB to outsource the handling of rough diamond, imported for auctions or sales to ITDC to be constituted jointly by GJEPC and BDB. Also, the government asked BDB to identify and submit floor plan including security related features.

“Trading by global miners in India was not allowed in India. Global miners are allowed now to bring even run-of-the-mines goods. For them, we have identified 4000 sq ft with 10-12 rooms which global miners would hire and conduct trading. The unsold quantity may always be taken back,” said Anoop Mehta, President, BDB.

The government has identified BDB as a custodian of rough diamond import and export for which the Precious Cargo Customs Clearance Centre at BKC has been notified as a nodal agency. The import of rough diamonds will be permitted through air cargo mode only. No import of hand carriage or express courier service mode will be permitted.

Sanjay Kothari, an industry veteran, said, “We are in talks with global diamond miners to bring them for trading of rough diamonds in India. As of now, individual traders, sightholders or processors were importing goods on their personal capacity. With this, however, Indian diamond processors will be at an advantage.”