This news story first appeared in DNA edition on Saturday July 16, 2011.
It might be premature to say the country’s financial capital will have to part with diamonds but three blasts in Zaveri Bazaar, the diamond trading hub, and better infrastructure in Surat might change the traders’ hearts.
Mehul Choksi, chairman and managing director of the Geetanjali Group, admitted that Surat has the potential. Gujarat is already processing all the country’s diamonds “but it would be little too early to say it might turn into a hub for the diamond trading business”, he said.
“Relocating base is time-consuming and a painful process. I guess that is why the shifting from Opera House (Pancharatna and Prasad Chambers) to Bandra Kurla Complex is still going on despite the security risk here.”
Sanjay Kothari, vice-chairman of The Gem and Jewellery Export Promotion Council (GJEPC), said relocating to Surat could happen. “But there are over 2,000 families connected with the diamond trading business in Mumbai,” Kothari said. “It will not be possible to relocate all of them to Surat for personal and professional reasons. But the situation might change some years down the line and it could make sense then.”
Over 90% of world’s diamonds are cut and polished in Surat, the commercial capital of Gujarat. The customs clearance centre in the city, Surat Hira Bourse (SHB), operational since 1994 facilitates direct import and export of diamonds.
Also, the Surat Special Economic Zone (SurSEZ) has over 150 export oriented units, a significant percentage of them being from the diamond processing and jewellery making segments.
Shashikant Bhai Shah, diamond trading consultant with BM Gems, said Mumbai has traditionally been the trading and sorting hub for diamonds. “But Surat offers several advantages considering all the cutting and polishing is done there,” Shah said. “Combining it with trading and sorting would save traders save time and money on transporting the precious stones.”
Though Mumbai remains a terrorist soft spot, it has direct international connectivity, which is vital for an export oriented business like diamonds. And that is where it scores over Surat.
Talking about direct international connectivity, Mundra Port & Special Economic Zone (MPSEZ), a company promoted by Ahmedabad-based billionaire Gautam Adani, plans to build an international airport in Mundra. The company sent a proposal to the Board of Approval (BoA) in September last year. If the proposal is approved, MPSEZ will become the country’s first multi-product SEZ to have an international airport within its limits.
The possibility of shifting to Surat cannot be ruled out but manufacturing and trading do not generally happen at the same place in the country, Shah said.
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