Globally renowned Surat diamond industry in major crisis
The once-glittering diamond industry in Surat, known for employing around seven lakh workers in numerous factories dedicated to cutting and polishing rough diamonds for export, is now facing significant challenges.
Large-scale job losses, salary reductions and job insecurity have overshadowed the industry due to geopolitical tensions and waning global demand for diamonds, triggering a severe recession in Surat, the world’s largest hub for diamond cutting and polishing.
Experts highlighted two main issues affecting Surat’s diamond factories: a shortage of rough diamonds and insufficient demand for polished diamonds, most of which are exported.
American sanctions and the G7’s ban on Russian diamonds have led to a substantial supply shortage, Russia being a major supplier of rough stones while global factors such as the Russia-Ukraine and Israel-Palestine conflicts have hit demands, since 95 per cent of polished diamonds are exported.
According to Jagdish Khunt, president of Surat Diamond Association, the industry’s turnover has dropped from nearly Rs 2.25 lakh crore in 2022 to around Rs 1.5 lakh crore now, marking two years of negative growth.
While large firms have managed by granting extended vacations and salary reductions of 20-40 per cent, smaller firms employing 100-500 artisans have struggled to survive and have had to lay off workers.
In response to the crisis, the Surat Diamond Workers’ Union launched a suicide helpline last month for those affected by job losses and financial difficulties, which has received 1,600 distress calls within weeks.
Industry representatives are calling for state government assistance and for diamond factory owners to provide support to workers and their families to help them weather this crisis.
