the earliest diamonds were first discovered in the riverbeds of Golconda or modern-day Hyderabad over 4,000 years ago . And for a long time, India was synonymous with diamonds. But we don’t seem to have massive mines to compete with the rest of the world anymore. In fact, we have just one mechanised mine in a town called Panna in Madhya Pradesh. (Now you know why Indians refer to diamonds as heera-panna!) (View Highlight)
And by that, we mean the cutting and polishing bit. Now the reason why we became successful is simple — low cost of labour. See, if the US spends $100 per carat to cut a diamond, India can do it at 10% of the cost. And not only do we have cheap labour but also skilled ones who can work with the smallest of diamonds. Since small diamonds require a lot of labour, the abundance and costs of employing such workers have helped India monopolize the industry i.e. cut and polished diamonds under 1 carat. (View Highlight)
And Surat emerged as the hub. Thanks to the efforts of a couple of enterprising brothers ― the Mavjivanwalas who decided to set up shop in the early 1900s. While the trade slowly picked up, a seismic shift happened when Gujaratis decided to immigrate to a famous diamond trading hub in Europe in the 1960s. We’re talking about Antwerp in Belgium. Once there, these Indian immigrant folks weaved their way into the diamond business. But instead of using local labour, they opted to use cheap family labour back at home. They sent the diamonds to Surat for polishing. (View Highlight)
people in the US and China seem to be tightening their belts. They’re cutting back on buying diamonds. (View Highlight)
But there’s something else too this time around–Russia. See, at least 30% of our rough diamonds come from Russia. We’re quite dependent on them. But when Russia decided to invade Ukraine, this threw a wrench in our plans. No one wanted diamonds that originated in Russia. Countries wanted to place sanctions and cripple the country’s economy. Russia was cut off from the dollar banking system that the world relied on. (View Highlight)
The only saving grace was that the supply wasn’t completely choked off. Because even if the world didn’t want to be seen associating with Russian diamonds, they couldn’t just do away with it entirely. (View Highlight)
You see, at the start of the supply chain, diamonds get a certificate that stamps their origins. This is to prevent the so-called blood diamonds from entering the system. But after that, once the stones from various parts of the world come to be processed in places like Surat, everything gets mixed together. The diamond takes on a ‘mixed origin’ documentation. That means once a polished diamond is ready to be set into jewellery, it’s quite hard to pinpoint whether it had roots in Russia. (View Highlight)
But the Western world is still trying. They’re figuring out ways to trace the origins of Russian diamonds so that they can pull the plug on this part of the trade too. They’re even trying to convince Belgium , which runs the world’s largest diamond trading hub in Antwerp to join forces too. (View Highlight)
