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Shvoong Home>Business & Finance>International Business>Recession-Hit Surat’S Diamond Units, Resume Operations Review

Recession-Hit Surat’S Diamond Units, Resume Operations

Article Review   by:DevisMartin     Original Author: Devis Martin
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The recession-hit diamond units in Surat are basking in new-found glory with around 500 units resuming operations in the past month. Now the units are looking for more workers now.

About 40,000 diamond workers in Surat lost their jobs owing to the global recession that badly hit the state’s Rs.50, 000-crore industry.

Before Diwali around 2500 to 3000 units were operational, however, only 1000 units resumed their operations after Diwali, informed the President of Surat Diamond Association (SDA)

Now, with 500 units re-opening this month, almost 1,500 units are now back in business.

An improvement in the domestic demand has encouraged the closed units to re-start their operations.

It is said that the units that re-opened after Diwali had cleared the raw material stock, despite incurring losses. So at present there is no stock in the pipeline and so units are aggressively purchasing raw materials as the trading activities pick up, informed the former President of SDA.

Trading has also resumed in Surat. Consequently prices of rough diamonds have increased 20 percent recently. Though prices of polished diamonds have not improved, as compared to the rough diamond, there is great amount of optimism in the market that prices of polished diamonds will also increase in the coming days.

Nearly 90 percent of the diamonds cut and polished in Surat are exported. “Recession has not hit India as much as it has affected the western countries, informed an official of SDA

He informed that Indian consumers have started buying diamond for investment purposes, a change in stand as earlier they were inclined to buy only diamond jewelry.

However, the situation is not that upbeat. Cutting and polishing units that resumed operations are operating with only 50 to 60 percent of the workforce, since many of those who were laid off had switched over to other industries, like textile and agriculture
Published: May 30, 2009   
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