The Gem and Jewellery Export Promotion Council (GJEPC) held a meeting in Mumbai, bringing together senior diamond industry bankers. This interactive workshop, held on October 28th in BKC, Mumbai, intended to foster an open discussion between players in the diamond business and financing institutions. The primary goal was to examine the sector’s existing issues and understand their potential implications for bank credit.
GJEPC prominent officials attended the meeting, including Chairman Vipul Shah, Vice Chairman Kirit Bhansali, Banking Insurance & Taxation Sub-committee Convener Saunak Parikh, and Executive Director Sabyasachi Ray. Anoop Mehta, President of the Bharat Diamond Bourse (BDB), and Biju Pattanayak, Executive Vice President and Head of the Global Diamond & Jewellery Group at IndusInd Bank, a banking luminary, were also there.
“It is my hope that this meeting will serve as a platform for productive conversations, fruitful collaborations, and the building of enduring partnerships between the diamond and banking sectors,” said Vipul Shah, Chairman of GJEPC, during his remarks. We can harness the entire potential of these businesses and chart a course toward a more affluent and sustainable future if we work together.”
The speakers emphasized the significance of “de-inventorising” the diamond chain as a fundamental step in reviving profitability, creating trust, and regaining confidence in the diamond market. According to them, an optimistic sign is the growing change in jewelry consumption in India from gold to diamonds, signaling favorable prospects in the home market. Furthermore, emerging nations such as India are poised to account for a sizable share of world diamond consumption, perhaps ranging from 20-30%. A revived Japanese economy also bodes well for the industry.
China’s underperformance in terms of diamond jewelry consumption is nevertheless a source of concern. Banks were also under strain as a result of the lower return on capital. However, one encouraging sign is that outstandings for the diamond industry have decreased by almost 30% since March of this year. However, this presents issues for banks because, under the new Basel Regulation, they must carry the capital cost on the sanctioned limits.