Against the backdrop of the complication of the situation and tougher credit conditions in the diamond industry, the Council for the Promotion of the Export of Precious Stones and Jewelry (GJEPC) organized the Banking Summit, held on June 28, 2014 in Mumbai.
Recently, the banks of Antwerp Diamond Bank (ADB) and ABN Amro have significantly reduced the crediting of diamond purchases by diamantaires. Similarly, Indian banks began to exercise excessive caution in securing financing for companies operating in the gem and jewelery sector.
In the provision of debt financing, creditor banks began to more closely check counterparties, including sightholders of DTC, ALROSA clients and Rio Tinto, which is associated with a growing number of defaults on loans in Surat, Mumbai and Antwerp. This had a negative impact on the entire sector, especially on small and medium-sized enterprises, which faced a severe shortage of funding.
The summit was organized to facilitate the situation in which participants in the precious stones and jewelery sector found themselves and ensure their interaction with bankers and the Indian government. The Bank Summit in 2014 was attended by senior officials of the banking sector, the precious stones and jewelry industry and the Ministry of Finance of India.
The central topics for discussion were the financing of the precious stones and jewelery sector, loan guarantees and a number of other issues. Industrialists talked about the current scenario of the development of the Indian jewelery and jewelry industry, and the banks as a whole expressed their support, and also talked about actual problems.
Although the "transparency" of the company's activity is a high priority criterion in the selection of customers, banks advocate for corporateization of borrowers to ensure a more complete evaluation of companies.
GJEPC Chairman Vipul Shah spoke about the pace of growth in the Indian gem and jewelery sector over recent years and the challenges faced by companies, adding: "We called on the Ministry of Finance or raise the capital of the Export Credit Guarantee Corporation (ECGC), or ask the IRDA insurance market regulator to give greater freedom to local insurers so that local banks can take credit guarantees from international organizations. "