India seeks increased diamond trade

Source: India seeks increased diamond trade – DailyNews Live

John Kachembere      24 March 2017

BULAWAYO – India said it is seeking to develop Zimbabwe’s diamond sector
through increased trade.

One of the emerging Asian giant’s leading industry bodies, I am SME of
India, yesterday said it was looking for ways to partner with local
diamond producers.

“It’s deplorable that Africa in general and Zimbabwe in particular has not
benefited from its natural resources.”

“As such, we would love to have synergies with Zimbabwe and trade directly
with the country without the use of middlemen,” I am SME of India
chairperson Rajiv Chawla said.

I am SME of India is an integrated business association with various firms
involved in manufacturing, telecommunications, banking, and insurance
among others.

India has a thriving diamond cutting and polishing industry – the largest
in the world – which rakes in millions of dollars annually.

However, the Asian nation’s plan may face many hurdles considering the
fact that Zimbabwe’s diamond industry has taken a dive since last year
after the government forcibly took over the diamond fields from private
firms and formed the State-owned Zimbabwe Consolidated Diamond Company.

Since it began operations last year, the country’s diamond production has
been struggling to meet targets.

The State-owned diamond miner produced 972 765 carats of diamonds in the
first half of 2016 against a six million carat target. Zimbabwe was at
some point believed to hold more than a quarter of the world’s diamonds.

Meanwhile, Chawla said Zimbabwe’s imports ban could help grow the
country’s economy if its manufacturing firms partner with India.

“Statutory Instrument 64 (of 2016) can create an opportunity for
collaboration with India for import substitutions,” he said.

According to data from Mines minister Walter Chidakwa, ZCDC is only
producing 95 000 to 100 000 carats a month against a target of
approximately of between 300 000 to 350 000 carats.

All else being equal, the country should be getting about $30 million per
month from diamonds but this is not the case.

Finance minister Patrick Chinamasa has attributed the low output levels at
ZCDC to lack of adequate capital on the part of operating companies under
the State-owned company as well as reluctance by previous companies to
merge into the newly-formed company.

Diamond revenue has remained a national  headache with very little being
realised from the auction of Zimbabwe’s gems. President Robert Mugabe last
year claimed the country had lost an estimated $15 billion to leakages in
the sector.

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