A diamond firm in Gujarat has announced a 10-day vacation for its 50,000 employees to control the production due to the fall in the global demand of diamond and growing inventories of domestic players.
Kiran Gems, which claims to be the ‘world’s largest natural diamond manufacturer’ and is also among the largest exporters of polished diamonds, announced the vacation from August 17-27.
The diamond manufacturers have been facing hurdles after the US-imposed sanctions on Russian-origin diamonds and the G-7 countries announced a ban on the same following the Russia-Ukrain war in 2022.
Kiran Gems chairman Vallabhbhai Lakhani said, “Currently, the diamond industry is going through a bad patch…a recession period… as there is no demand for polished diamonds globally. We have declared a 10-day holiday so that the production of diamonds can be controlled. Such a decision was taken for the first time in the company’s history.”
He said: “The price of polished diamonds has gone down globally and it has become difficult for diamond manufacturers to run their business. If the supply is controlled, the demand will grow and it will benefit the industry. “Normally, the diamond factories go on long vacations during Diwali. The Kiran Gems, with an annual turnover of Rs 17,000 crore, is also among the sight holders (authorised buyer of rough diamonds) of De Beers, one of the leading diamond companies globally.
De Beers had earlier reported a 15 per cent reduction in rough diamond production in the second quarter ending June this year compared to the first quarter, citing “higher than normal” inventories as one of the reasons.
“Over 50,000 diamond polishers work in my firm out of which 40,000 cut and polish natural diamonds while 10,000 work in the lab-grown diamond unit. We are also looking to compensate diamond polishers for the vacation days. If other diamond companies collectively take a similar decision, the production can be controlled and it will help the industry,” Lakhani said.
Notably, Lakhani was among the first to relocate his office from Mumbai to the Surat Diamond Bourse (SDB) after it was inaugurated by Prime Minister Narendra Modi in December last year. He was also the SDB chairman before he resigned and returned to Mumbai in March as the business in Surat failed to do well. However, he continues to be a part of the core committee.
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