NEW DELHI: Union Minister of State for Commerce Jairam Ramesh, aimed at increasing India’s engagement with major diamond-producing African nations, has chalked out a comprehensive plan to ensure direct imports of rough diamonds from Africa instead of Europe.
Starting this initiative, Mr. Ramesh will be leaving for a six-day long visit to Namibia and Angola, two major rough diamond producers, on March 26, while the second leg of the programme will follow soon where the world’s two largest diamond producing nations — Botswana and South Africa — will be covered.
Explaining the importance of the visit, Mr. Ramesh told The Hindu that “I started this initiative largely because the diamonds-cutting and polishing trade is employment-intensive and provides livelihoods to over 10-lakh families in our country. The growth of India’s diamond industry depends on how we build our relationships with major exporters of diamond.” He will be accompanied by senior officials of the Gems and Jewellery Export Promotion Council (GJEPC) and trading giants like the State Trading Corporation of India and MMTC.
India is the world’s largest importer of rough diamond and exporter of cut and polished diamonds with over 90 per cent market share. India’s estimated imports of rough diamonds this fiscal would be around $10 billion, while exports of cut and polished diamonds are likely to cross $14-billion mark.
At present, rough diamonds are procured by India through a variety of sources, with the bulk of them coming through Antwerp in Belgium. But now the Minister wants to establish systems for direct imports of rough diamonds from Africa. Angola produces about 10 per cent of the world’s rough diamonds, while Namibia accounts for about 6 per cent of production.
Angola and Namibia are the world’s fifth and sixth largest producers of diamonds, respectively, after Botswana (25 per cent), Russia (22 per cent), Canada (12 per cent) and South Africa (12 per cent).
According to Mr. Ramesh: “In future India will find it difficult to source rough diamonds unless it demonstrates to African nations that it will collaborate actively in helping them move up the value-chain and assist in value-addition in these producing countries itself. The Africanisation of the diamonds processing industry is not a threat to India but a great opportunity which we must proactively embrace,” he explained.
Mr. Ramesh pointed out that it is in India’s long-term interest to establish direct relationships with supplier countries, cutting out all the middlemen.
Though India had embarked on exploration of diamonds, it would take at least a decade before commercial deposits in States like Chhattisgarh, Andhra Pradesh and Karnataka were proven and established. The diamond cutting and polishing industry would continue to be entirely dependent on imports of rough diamonds for a long time to come, he explained.
“Partnerships in diamonds must be embedded in the framework of broader economic and technological cooperation. That is why the diamond delegation has representatives of other public sector companies like the power-equipment manufacturer BHEL and ONGC-Videsh,” Mr. Ramesh added.
The Minister also said rough diamonds are not the only area where India must change its approach to Africa. India’s cashew processing industry, another employment-intensive industry, depends crucially on imports of over five-lakh tonnes of raw cashews from Africa with India’s own domestic production itself being roughly of that amount, he added.