Home » Fresh sanctions on Russian diamonds put 1 million jobs at risk, ET Retail

Fresh sanctions on Russian diamonds put 1 million jobs at risk, ET Retail

by TopBusinessView


Kolkata: Employment of one million diamond workers in Surat hangs in the balance as G7 countries have put fresh sanctions on diamonds mined in Russia.

Indian diamond trade cuts and polishes 9 out of 10 diamonds available in the world and imports Russian diamonds from Alrosa, which accounts for 30% of global rough diamond output.

“If the sanctions continue, then there will be a lot of uncertainty in the employment of one million workers,” said Vipul Shah, chairman of Gem & Jewellery Export Promotion Council (GJEPC).

G7 countries are imposing fresh sanctions against Russia to try to further hinder its war effort in Ukraine.

In the process, however, diamond workers in Surat have started to suffer due to non-availability of rough diamonds from Russia coupled with a fall in demand amid a global economic slowdown and rising fears of a global recession largely due to the ongoing war.

“The demand is less now, so the industry is being able to handle the situation despite rough diamond supply being less,” Shah said. “The problem will arise when the demand increases.”

Traceability Challenge
As there is no definite method to identify from where a particular piece of diamond originated, G7 is looking to deploy traceability techniques to identify the origin and reduce movement of Russian diamonds in world markets.

“In order to reduce the revenues that Russia extracts from the export of diamonds, we will continue to work closely together to restrict trade in and use of diamonds mined, processed or produced in Russia and engage with key partners with the aim of ensuring effective implementation of future coordinated restrictive measures, including through tracing technologies,” the grouping said in a statement.

Shah of GJEPC said at present, “there is no such technology” to trace the origin of diamonds. “What we have now is the Kimberley Process certification,” he said.

Kimberley Process is a multilateral trade regime established in 2003 with the goal of preventing the flow of conflict diamonds. The core of this regime is the Kimberley Process Certification Scheme (KPCS) under which states implement safeguards on shipments of rough diamonds and certify them as “conflict-free”.

  • Published On May 23, 2023 at 08:11 AM IST

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