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Surat's diamond industry -- which had been severely hit by the global slowdown -- is slowly gaining momentum with demand from domestic, international and emerging markets, like China, rising, industry sources said on Monday.
"Demand for polished diamonds has picked up in last two months," regional chairman of Gujarat, Gems and Jewellery Export Promotion Council, Chandrakant Sanghvi, told PTI.
"The demand has started pouring in from all quarters, but Chinese and domestic markets are emerging to be the major consumers of diamonds post slowdown scenario," Sanghvi said.
Because of recession in the United States and Europe, the diamond industry of Surat, which is mainly export-oriented, had a major downturn since 2008 end, which resulted in closing down of processing units leaving thousands of diamond workers jobless.
According to the state government, 20 diamond workers committed suicide after recession hit diamond industry.
The Reserve Bank of India figrues too show that the diamond industry in Gujarat accounts for 72 per cent of the world's processed diamonds and 80 per cent of India's diamond exports.
The diamond market has improved slightly, but it is difficult to take a call on the post slowdown scenario today, Rohit Mehta, president, Surat Diamond Association, said.
"Since the prices of rough diamonds keep fluctuating, it is difficult to assess the market scenario," Mehta added.
"Exports are not very encouraging as off now, but we expect the scenario to turn positive with the revival of economy in Europe," he said.
Big time exporters are now banking on domestic demand for diamonds and from growing markets like China, Mehta said.
Those who took entry when the prices of rough diamonds dipped nearly by 40 per cent from top value are at an advantageous position now, but some units were compelled to book losses, he said.
Hit by the slowdown, the diamond capital Surat's polishing units had extended its vacation period in December last year and halted imports of rough diamonds on the call of its apex industry body.
The import of rough diamonds was halted between November 25 to December 26 to avoid stock piling, industry sources said.
As per estimates of the state government, there are about 6,547 diamond processing units employing about 700,000 in the state, out of which Surat contributes to 38 per cent units and 57 per cent of the workforce.