Commonwealth Network

The Indian Budget 1996-97 The Indian Economy Overview

IN DEPTH: Indian Diamond Industry

Diamonds are a girl's best friend, and the trade knows it

Though India was known to have diamond mines many centuries ago - the fabulous Kohinoor is an Indian diamond - it has virtually no mines today. However, India has continued to maintain its tradition of diamond cutting and thousands of people are involved in this skilled occupation.

The Indian diamond cutting centers are concentrated in Bombay and Surat, a small town about five hours away from Bombay. Small boys, sometimes as young as 10 years old, work in hot sheds chiseling roughs which eventually get sold in the fancy shops on Fifth Avenue and Bond Street. Their nimble fingers and sharp eyes enable them to cut these diamonds

Diamond cutting and polishing workshop in Bombay.

in remarkable shapes, but while they earn well for these skills many of them find their eyesight getting progressively weaker as they grow older.

But India has a large labor force and this has made the country the biggest diamond cutting center for small roughs. Indeed, were it not for Indian workers, many of these small diamonds would be put to industrial use rather than jewelry. The Indian diamond trade generates over 4 billion dollars in exports every year -- this represents an almost 25 percent value addition to the imports of roughs.

The trade itself is controlled by a handful of companies and families, most of whom hail from the small town of Palanpur in Gujarat. Many of them are fabulously rich and divide their time between India, Belgium, Israel and other western countries.

This entire high-skill, high value trade has recently been shaken up by the conflict between the De Beers-Central Selling Organization (CSO) global diamond cartel, and Argyle of Australia, one of the biggest players in international diamond trade.

We have a report on India's reaction to this war.

Sidharth Bhatia is a senior Indian journalist who runs a well known television program on Indian business and current affairs. A former newspaper editor and foreign correspondent, Bhatia has written for several publications in India and abroad.

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