Surati and Russian Rough Diamonds Collaboration

The Indian city of Surat is well-known for its diamond manufacturing and trading. 7 out of 10 diamonds produced internationally are cut, polished and handled in Surat. Therefore, Surati diamond production is highly dependent on the rough diamond market which is based in Antwerp. Surat requires a large amount of rough diamonds to be delivered to their diamond treating facilities, where the diamonds are to be polished and processed.

Since Russia is responsible for over 50% of rough diamonds which are produced globally, it is no wonder that Surati officials are seeking an alliance with the diamond mogul. Rough diamonds which are mined in Russia are usually sent to trading hubs in Anrwerp and Israel, before reaching Surat. Consequentially, Surat is attempting to cut out the middle man when it comes to rough diamond supplies by signing an agreement with Russia which will ensure rough diamonds be delivered directly to Surat. In so doing, Surat will cut out the cost of purchasing rough diamonds through trading centers.

The Surat Diamond Association president, Rohit Mehta, has recently asked Alexander Mantytsky, the Russian Consulate General in Mumbai, to assist in procuring an agreement with Russian diamond companies (specifically with Alrosa, the second largest Russian diamond company, after DeBeers) which will ensure rough diamonds be directly delivered to Surat. The idea was to establish a system which would allow local Surati diamond manufacturers direct access to large supplies of Russian rough diamonds, at relatively low costs. KK Sharma, the executive director of the Indian Diamond Institute was recently quoted having said that: "The direct supply of rough diamonds makes sense, as it would mean more economic benefits… since the traders are out of the picture."

Rohit Mehta explains that a direct supply of rough diamonds from Russia to Surat is idyllic for the Indian diamond industry, and that the Surat Diamond Association is more than willing to help set up a rough diamond exchange system by arranging summits with the local Surati diamond manufacturers and traders. He added that the Surat Diamond Association has invited Russian diamond companies to open branches in Surat City, which will encourage the direct trade of rough diamonds in the area. Mehta claims that he has received some positive feedback from the Russian general and that if the proper trading infrastructure were to be erected, then both countries will profit immensely.

Over the past few years, the Surat Diamond Association has made numerous attempts to secure direct rough diamond delivery treaties with various countries. Surat has previously made efforts to promote trade with the country of Angola, which is one of the largest rough diamond producers in Africa. Although nothing formal was ever signed, the attempt resulted in many Surati diamond manufacturers purchasing their supplies of rough diamonds from Angolan based companies.