08 Apr 2020
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A Crisis like No Other
We've witnessed recessions and braved many a crisis, but the impact COVID-19 is having on the industry at large is like no other. Stakeholders in the diamond business as well as gemstone manufacturers believe that all they can do is wait, watch and protect the safety of their staff and clients
By: Diamond World News Service
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Mar 23 2020 7:00PM
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Reference: 24832  

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Let’s face it, the situation the industry is in today is not just grave but also peculiar. We’ve never been faced with a crisis like this in the past. We’ve braved recessions and even incidents like demonetisation – to say that coronavirus has brought the world to a standstill is an understatement. We spoke to stakeholders in the industry in February, while COVID-19 was not yet a global issue.

End of January, even when WHO declared coronavirus as a global health emergency, we didn’t realise the ramifications this deadly virus would have on lives globally, killing several thousands of people all over while bringing stock markets down to its knees. Several jewellery shows have gotten cancelled and postponed along the way. In the midst of all this, we were all wondering how this would play out for our industry.

Today, we are still wondering the damage COVID-19 will have on our industry, however, the first thing we all want is to get out of this pandemic safe and sound. Mid February, the GJEPC was negotiating with banks and the government to cut exporters some slack in terms of paying their loans back with regard to oversees shipments and a little over a month later, Bharat Diamond Bourse is on a lockdown. The Surat diamond industry has also shut down and this is the case globally. Bourses in Israel and Antwerp have also shutdown indefinitely. “The entire world has come to a standstill. There is no clarity on anything. It is very difficult to assess this situation because we have not experienced this before. There are zero sales and zero purchase happening. We are just incurring the operating expenses. People are comparing this to the 1930 crisis. It is just a wait and watch game right now. It is important to stay safe and be responsible. We will eventually bounce back,” says Vipul Shah of Asian Star.

In our industry, work-from-home is not a viable option for many companies. Diamonds and jewellery are high-value products. Jewellery cannot be manufactured at home and diamonds cannot be cut and polished at home. “India is taking all the necessary steps. Considering the population, we can’t afford to face what Italy is facing. Yes, people are working from home but it is not the same. There are things that can happen only in office. The losses are huge but this is the case for every sector all over the world. I think the lock-down might go on for longer, beyond 31st March, till mid April. If we follow the rules and act responsibly, we can bounce back from this quicker, going by what is happening in China and HK,” said Kashish Shah of M.Suresh.

The Government of Maharashtra might extend this lockdown beyond the 31st of March if the situation in the state worsens. “There is already an oversupply of polished diamonds in the market. In a way it is good that Surat is not manufacturing any more diamonds. However, BDB should start functioning from April. If not, we will face issues everywhere like payments, shipments etc. Except for HK, offices are shut everywhere else. No one is in a position to say what the implications of this are going to be. I’ve been in this industry for 30 years and I have not come across something of this magnitude. Even during World War, a few markets were open,” says Vipul Sutariya of Dharmanandan Diamonds.

Early March, the council postponed the International Gem and Jewellery Show that was supposed to happen in Jaipur. Today all of Sitapura is on a lockdown. “No business is happening. Jaipur is on a complete lock down. All the factories in Sitapura have closed down. Exports as of today are nil. Once this is all done, it will take a minimum of six months for us to restart the business. This is the case all over the world,” said Nirmal Bardiya of RMC Gems. Zaveri Bazar, the hub of gems and jewellery in Mumbai has also been shut till 31st March. “We are not thinking about our business now. The health and safety of our staff and clients are of utmost priority right now. We should remain united and act together to come out of this. It is very hard to say what the impact will be but we need to lift each other up and be a lot more flexible,” said Kamal Punjabi of TT Gems.

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