A latest media report suggests that almost 2,000 people have lost their jobs in Surat on the back of a slump in demand for cut and polished diamonds in the West and China over the past one month.
How Did This Happen?
It is noteworthy here that around 80 percent of diamonds sold in the world are polished in Surat.
Basically, this industry provides employment to about 8 lakh workers in about 4,000 cutting and polishing units.
The secretary of Surat Diamond Association (SDA), Damji Mavani said that the decline in demand has forced most of the units to work only at 60 to 70 percent capacity.
This simply implies that there is a need for fewer workers in this field.
Fear Of Return Of Recession
The fear of a return of the 2008-like recession looms large on the diamond city of Surat, said Bhavesh Tank, the vice-president of the Diamond Workers Union in Gujarat.
Further adding, “Orders are fewer and so the workload is less. Therefore, the units are reducing the workforce. Some units are cutting down work days so that they do not have to pay the workers on days when they are not working.”
So far, the US is the biggest market for cut and polished diamonds, and China is a close second.
During the previous year, India’s diamond exports slowed down 5.43 percent between April and November 2022.
This has also affected the prices of the diamonds as the prices of polished diamonds have softened in consequence of the demand drop.
Further, impacting the margins of the diamantaires and forcing them to cut down on manpower, though the rough diamond prices remained high.
