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Beleaguered Indian diamond traders seek help from government, RBI

Staring at huge losses and standstill business, diamond houses have sent an SOS to the government and the Reserve Bank of India (RBI) amid the coronavirus (Covid-19) outbreak that could deal a body blow to the trade yet to recover from last year’s Hong Kong protests.

Gems and jewellery houses on Tuesday reached out to ministries of commerce and finance as well as the central bank, asking for leeway and time for credit facilities availed by exporters of polished diamonds and importers of rough stones. “The letter of credit, packing credit and bills outstanding for shipments to China or Hong Kong and for goods already exported for which payments are receivable from buyers in these regions should be given at least six months of additional time to resolve financial delinquencies,” said Pramod Kumar Agrawal, chairman of the Gem & Jewellery Export Promotion Council in a note to the government and the banking regulator. About 35-40% of the industry’s business is with mainland China and Hong Kong which also serves as a key midway port for global distribution. Hong Kong authorities have postponed the Hong Kong International Diamond, Gem & Pearl Show 2020 and Hong Kong International Jewellery Show 2020 from early March to May in the wake of the virus attack. “Exports will be down 30-35% in the next two months. Our offices in Hong Kong and China are closed temporarily. Most staff have returned to India,” Mavji Patel, managing director of leading diamond exports firm Kiran Gems, told ET. He said the two exhibitions scheduled in March and were expected to generate good business. Courtesy - ET



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