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vipul_shah_2.jpgVipul Shah, Chairman of the Gem & Jewellery Export Promotion Council of India (GJEPC) is the CEO & MD of Asian Star Co. Ltd., a market leader in the Indian gem and jewellery industry.

Here, he discusses the deliberations at the World Diamond Conference that concluded recently in New Delhi. The highlight of the conference being the presence of H.E. Vladimir Putin, Hon. President of the Russian Federation and Shri Narendra Modi, Prime Minister of India  at the inaugural function in Vigyan Bhavan, on December 11, 2014.

The Conference saw the who’s who of the global diamond and jewellery industry converged to New Delhi, to exchange ideas and discuss the challenges of the future consumer market for polished diamonds and diamond jewellery and other issues.

Vipul Shah with Rough & Polished for you...

Did the results from the World Diamond Conference meet with your expectations? And what do you think is the major conclusions that were achieved from the two-day deliberations?

The World Diamond Conference met with an astounding success. We are grateful to the leaders of mining companies, retailing, banking and industry bodies who attended this conference and enlightened all of us with their thoughts and future course of action to be taken for the benefit of the global gem and jewellery industry.

With the attendance of Shri Narendrabhai Modi and H.E. Vladimir Putin together at the Conference, this industry has received its due recognition by the respective Governments.

Regarding ALROSA contracts, did you expect more, given that only three were new contracts signed and the rest were renewals? Will GJEPC push for more in the future?

I would like to clarify here that the success of any business is measured by the volume of business done and not by the number of contracts signed. Approximately, USD 700 million worth of rough diamonds comes to India annually from Russia. ALROSA, being one of the largest suppliers of roughs, signing of contracts be it new or renewal and any additional coming to will lead to an additional increase in inflow of roughs to about 40%. We expect that post this development more mining companies will get encouraged to do long term contract with Indian diamantaires.

With the Ruble sliding down, do you see a decline in rough prices from Russia?

Rough prices across the globe are controlled by market forces and not too much impacted by any particular currency. Nevertheless, with the decline of the Ruble, what we can expect is the mining costs may go down for ALROSA who in turn may pass on the benefits to its clients, if possible.

During the Conference in Delhi, it was mentioned that Indian manufacturers could invest in Russia by setting up diamond and jewellery manufacturing units. Are Indian manufacturers interested in doing so?

Indian manufacturers have spread their wings in many countries including Hong Kong, China and Bangkok as it made business sense to them in doing so. If the conditions are conducive for good business in Russia, I don’t see a reason why they won’t do the same for Russia also.

Prime Minister Modi as well as a GJEPC press release mentioned about the “introduction of outsourcing of polishing services by India to cater to the needs of the worldwide diamond industry.” Can you please explain this for people who find ambiguity in this statement? Will India be taking up job work of cutting and polishing?

India, in essence has been doing job work of cutting and polishing for decades now. What our Honorable Prime Minister Mr. Narendra Modi and GJEPC were referring to was facilitating the same by way of certain regulations by Government at remittance stage for smooth flow of operations and such manufacturing taking place in India.

With regard to generic marketing, there did not seem to be any major attempts at funding WDMF’s initiative, despite at least three major miners being present at the Conference. Was any final understanding reached or decision taken in the meetings before the Conference?

The World Diamond Conference was jointly organized by GJEPC, Ministry of Commerce and Industry and WDMF. Mr. Alex Popov, Chairman, WDMF got an opportunity through this platform to elaborate on WDMF’s various initiatives and programmes undertaken for the benefit of the global gem and jewellery industry, which were positively noted by the Conference attendees. I am sure world miners will consider WDMF’s endeavours while drawing up their business plans.

As the resentment with WDC by the global trade organizations including GJEPC is an open topic, industry members would like to know the outcome of the meeting on 10th of December in New Delhi. Any conclusions arrived on that front?

I would like to take this opportunity here to mention that there were certain reservations but not resentment by global trade bodies against WDC. There was some difference of opinions over certain issues. GJEPC and BDB took pro-active steps to cordially resolve these issues. The meeting held on the 10th of December was very fruitful as all the world bodies came together to redefine the role of WDC and work harmoniously in the interest of the industry.

Your views please, on the current Indian diamond market… Do you see any prospects of higher polished prices in near future? And, your perception of the current global markets… Do you see the now slow consuming markets picking up in year 2015?

Diamonds are essentially categorized in the luxury segment and hence directly co-related to the country’s GDP. There is newfound vigour and enthusiasm in Indian markets, which has witnessed increase in FDI and has led to more disposable income in the hands of the consumer. Also, the Indian diamond industry is heavily dependent on the world economy. With the last two quarters recording positive growth in the USA, which is market for almost 50% of Indian gems and jewellery, we are highly optimistic about increased demand in 2015.

Aruna Gaitonde, Editor in Chief of the Indian Bureau, Rough&Polished