India Warns Of Missing Targets Due To High Rates, Financing
February 16, 04
Indian diamond industry leaders have warned that the country may not be able to achieve its ambitious export targets if interest rates are not lowered to global levels and possibly losing business to China if Indian banks do not provide dollar financing.
The comments were made by former Gem & Jewelry Export Promotion Council (GJEPC) chairman Praveenshankar Pandya at a seminar entitled Vision 2007 organized by the council and attended by industry leaders and heads of banks.
At the seminar, held last week in Mumbai, Pandya said interest rates should be brought down from 12 percent to 4 percent, in line with global levels.
Current GJEPC Chairman Sanjay Kothari told seminar participants that 60 banks provide funding to the diamond industry compared with just 15 banks two decades ago.
Indian diamond and jewelry exports account for 18 percent of India’s total exports, rising from a paltry $28 million in 1967 to $9.1 billion last year, Kothari said. The GJEPC aims to boost diamond and jewelry exports to $16 billion by 2007.
A major contributor to the Indian industry’s success was the opening of overseas offices by Indian firms, including 800 in the United States, 350 in Belgium and 250 in Hong Kong.
Kothari said the Indian industry’s one million-strong workforce cut and polished 11 out of 12 diamonds in the world, while the country was the world leader in the emeralds and tanzanite sectors. India’s aim was to make the country a one-stop shop for buyers from all over the world since it manufactures diamond, gemstone and plain jewelry.
The new Bharat Diamond Bourse, a complex of eight towers with nine floors each covering two million square feet to be equipped with the latest security systems and expected to be completed at the end of 2005, would be the GJEPC’s greatest achievement, Kothari said.