Russia's ALROSA to sell diamond roughs to Indian companies

Russian diamond mining giant ALROSA will start direct sales of rough diamonds to Indian firms beginning next year, after 12 Indian companies signed agreements to buy diamonds worth $2.1 billion in the next three years from ALROSA.

These companies signed the three-year contracts with ALROSA during the ongoing World Diamond Conference, which was inaugurated jointly by Prime Minister Narendra Modi and Russian President Vladimir Putin in New Delhi on Thursday.

"We have signed 12 contracts with ALROSA today to source diamonds worth $2.1 billion in the next three years," Gems and Jewellery Export Promotion Council chairman Vipul Shah said.

Under these agreements, over the next three years, ALROSA will supply $2.1 billion worth of rough diamonds to Indian companies at the rate of $700 million per year.

The conference has attracted major mining companies, retailers and diamond cutting industries.

Speaking at the inauguration, the prime minister said ''India is the natural venue for this conference. For one, it is generally believed that diamond is India's gift to the world. More than two thousand years ago, diamond was deeply valued in India. It was even traded with China over the Silk Route. Till about the 18th century, India was considered to the only source of diamond.''

The prime minister said he has laid three proposals before President Putin.

''First, I would like ALROSA to have direct long term contracts with more Indian companies. I am pleased to know that they are moving in that direction. Second, I want ALROSA and others to trade directly on our bourse. We have decided to create a Special Notified Zone, in which major mining companies can import rough diamonds on a consignment basis and re-export unsold ones. This is going to benefit Indian diamond industry and create more jobs for our youth. Third, I asked President Putin to reform regulations so that Russian jewellery makers can send their rough diamond to India and re-import polished diamond without paying duty. This will give a boost to our diamond industry. These measures will also boost India-Russia economic ties.''

Minister of state (independent charge) for commerce and industry Nirmala Sitharaman said her ministry has ''supported and promoted this (diamond) sector in its initial phases wherein, the imports of rough diamonds to India were eased, which in itself provided a smooth take-off for this industry,'' adding, ''since then the growth in the diamond sector and progressive improvement in the value addition chain have been contributing to the nation's industrial development.''

Sitharaman underlined the fact that the ministry has ''supported the cause of eradication of "conflict diamonds" in India and worldwide by being a founder member of Kimberley Process Certification Scheme.''

She also added that India ''still has tremendous potential, not yet exploited, for diamond exports. India has currently the largest number of artisans for making jewellery in the world. Practically, every village boasts of a family of artisans, having a very long tradition of jewellery making.''

Sitharaman said the industry has been experiencing a weakening demand and it now needs a tremendous boost - the revival of consumer enthusiasm for diamonds and the consequent increase of market share for diamond jewellery in the luxury sector.

India's diamond industry has established itself as the world's largest manufacturing centre of cut and polished diamonds for the last many years, contributing 70 per cent of the world's supply in terms of value, 85 per cent in terms of volume and 92 per cent in terms of pieces. Surat along with Navsari, Bhavnagar, Amreli are known as the diamond manufacturing/processing hubs whereas Mumbai is the diamond trading hub.

Gem and Jewellery Export Promotion Council (GJEPC), in association with the ministry of commerce and industry, and the World Diamond Mark Foundation (WDMF) organised this first ever-global congregation of diamond leaders in India.

Anton Siluanov, finance minister of Russian Federation, Illya Ryashchin, acting president of ALROSA Russia, Vipul Shah, chairman of GJEPC and vice chairman of GJEPC Pankaj Parekh were present during the inauguration.