Shah spoke at a meeting of an interactive thematic section organized by the Southern Gujarat Chamber of Commerce and Industry (SGCCI) in early August on "How to overcome the recession in the diamond" Industry).
Shah said that diamantaires producing large stones in Surat, in the past five or six years, were doing business using cash in their calculations. None of the companies currently have any problems, including his own company, Venus Jewels. Buyers of large stones from abroad willingly pay with money.
On the other hand, about 95 percent of diamond manufacturers and dealers provide goods to customers with a grace period of 90-190 days. In such circumstances, there is a 100 percent chance that buyers will not fulfill their payment obligations. For this reason, in the last year and a half the industry has faced a number of unfulfilled obligations.
"Providing goods in long-term credit literally kills the diamond industry. I urge the diamantaires to unanimously accept the monetary settlement system for the sake of prosperity. None of the diamond mining companies offers products on credit to their customers. Diamantaires need to learn from the business model of diamond mining companies, "Shah said.
Shah noted that diamond mining companies such as De Beers, ALROSA, Rio Tinto and others took active measures to counter the crisis in the Indian diamond industry. They (diamond mining companies) provided an opportunity for their Indian clients to postpone about 75 percent of the diamonds on the sites. This increased the confidence of diamantaires.
"The Chinese market is very weak, but we rely heavily on the United States market, which is still dynamic. Good times are just around the corner, and I hope that the upcoming Christmas season will bring the industry back to its path, "Shah added.
http://timesofindia.indiatimes.com/city/surat/Adopt-cash-system-to-curb-recession-in-diamond-industry-SP-Shah/articleshow/48485380.cms
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