The hopes of Rs 60,000 crore diamond industry of Surat for revival this Christmas has been dashed with recent terror attacks in Mumbai.
If the global downturn was not enough, the terror strikes has acted as a last nail for the industry which is not going to regain its 'sheen' even during the coming festive season which usually sees 30 per cent more sales than the average demand.
Diamantaires in the diamond city are already facing 40 per cent fall in diamond demand ahead of Christmas. The reason being that overseas buyers are avoiding their trade visits to Mumbai in the wake of terror attacks in Mumbai on 26 November.
Demand for international status for existing airport in Surat has been pending since long hence buyers have to route their way through Mumbai for trading.
"After a long vacation lasting for over two months, only 30 per cent diamond cutting and polishing units in Surat have resumed operations and remaining are likely to start their operations by December end," Surat Diamond Association (SDA) president, CP Vanani told Business Standard.
Diamond demand is usually shot up by 30 per cent before Christmas as the sales pick up in western countries during this festive season. On the contrary, the demand is expected to be lower by around 40 per cent this year during Christmas festival largely due to global slowdown in across the world, especially in US.
Surat is undoubtedly the cutting and polishing hub for diamonds but majority of diamond deals are struck in Mumbai and exports are also routed through the financial capital of the country. "Foreign buyers are treading cautious in visiting Mumbai for trading. Many are avoiding to pay visits to the city due to terror strikes," said Vanani.
"Despite Christmas, demand for diamond is sluggish due to global meltdown. Apart from this, terrorist attack on Mumbai has taken also its toll on the business too. Non Resident Indians (NRIs) are also refraining from visiting Mumbai for diamond purchases," said Pravin Nanavati, former president of Surat Diamond Association.
