Gujarat to boost diamond and jewellery business

February 19th, 2008 - 6:59 pm ICT by admin  


Ahmedabad, Feb 19 (IANS) Facing stiff challenges from Maharashtra and Tamil Nadu in the diamond and jewellery business, Gujarat is now evolving new strategies to retain its supremacy in the sector. The state, one of the world’s largest producers of gold jewellery, is planning a number of industrial projects in that segment aimed at expanding Gujarat’s presence in the field, said an official source.

The state with its diamond and jewellery units at Ahmedabad and Palanpur in north Gujarat, Bhavnagar in Saurashtra, and Surat, Navsari and Valsad in south Gujarat is one of the main contributors to the gems and jewellery industry in India.

Diamonds worth $9 billion are being processed in Gujarat, accounting for 80 percent of India’s total diamond exports, according to official data.

The Ahmedabad area, which specialises in manufacture of gold jewellery, has about 4,000 skilled workers. The labour productivity of this cluster is around 50 grams of production per day per workman, which is the highest in India, according to industry estimates.

The workers are skilled in polishing also. Rajkot is internationally famous for its unique hand-made silver ornaments, which constitute 85 percent of the total jewellery production in India.

As part of the new strategy, Gujarat is looking beyond Surat for diamond polishing. It is identifying places in other parts of the state where low cost diamond polishing zones could come up. A global diamond-trading hub is also being thought to enable domestic and foreign buyers to buy diamonds.

The state has plans to extend financial support to encourage processing units to go for latest equipments. The support however will be linked to units complying with the criteria and other terms of Bureau of Indian Standards. A marketing support plant is also being considered.

The other important component of the strategy is the setting up of two centres, one for hallmarking and the other for testing. A vocational training centre will be developed for high-end jewellery manufacturing.

A convention and exhibition centre is also under consideration at Bhat village near Ahmedabad. The Gujarat Industrial Development Corp is executing the project through a private developer. The centre will house two segments - core activities and allied activities.

Another convention centre will come up at Palsana near Surat. This project has been undertaken by the South Gujarat Chamber of Commerce and Industry.

Two years ago, entrepreneurs from Palanpur took over Belgium Jews as the premier traders in diamonds. At that time there were reports that eight out of ten diamonds sold worldwide pass through Gujarat polishers.

This pre-eminent position of the state is now being threatened by Maharashtra, which has identified gems and jewellery as thrust area of development. It has decided to offer promotional subsidy to gems and jewellery units in industrial clusters and parks.

Tamil Nadu, which has a strong gold jewellery base, has also taken measures to boost the growth of diamond and jewellery basis. The south Indian state has offered a subsidy of 10 percent on eligible fixed assets to medium and major industries, which venture into export-oriented gold jewellery and setting up diamond processing units anywhere in Tamil Nadu. This subsidy will be 20 percent in case of small-scale industrial units.

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