Gujarat’s Diamond Cutting and Polishing Industry Lost 15% Jobs as Economy Weakens

I think this is one sector that requires revolutionary change in their business model to allure millennials before they start perceiving gems as not worthy of their investment. Jewellers have tried too hard to engage audience through celebrity endorsements. I am just wondering, does it really work?? Are millennial’s looking to mimic celebrities? The diamond trade in Gujarat employs around 20 lakh people, said Babu Gujarati, a former president of the Surat Diamond Association. Of these, around 8 lakh people are engaged in cutting and polishing of rough diamonds.

Gujarat’s diamond cutting and polishing industry has cut 10-15% jobs due to weak demand from China and the Middle East, coupled with a liquidity crisis. Prices of polished diamonds have fallen 6-10% over the past four months and the industry doesn’t expect a recovery anytime soon. Diamond trade employs around 20 lakh people in the state, mainly in Surat and smaller centres such as Amreli and Bhavnagar. Earlier, Financial Express reported that the closure of companies owned by fugitive diamantaires Nirav Modi and Mehul Choksi hit Surat’s diamond trade badly.

How can job losses in the gems and jewellery sector be averted?

More than 20 Lakh people work in diamond cutting and polishing industry in India. After demonetization hundreds of labours became jobless in 2016-2017. When things started falling place Goods and service Tax implementation affected the industry adversely. Corporate Governance issues in PC Jeweller and Gitanjali Gems already tarnished reputation of Gems and Jewellery sector stocks in Market. Yet Titan showed good buying till 2019 elections thanks to Tanishq. Now the US-China trade war has started affecting the sector again. Gold is all time high but Diamond market is facing decrease in demand. European and US diamond markets are stable but China’s demand has decreased significantly. 17% year on year fall in polished diamond category will affect more than 15-20% workforce this year. Thousands of Diamond workers might lose their jobs in 2019.

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