More than 15,000 people have been laid off in the past few weeks in the labour intensive sector
As the economic slowdown is deepening across sectors, India’s diamond hub in Surat is facing its worst crisis since 2008. The industry has seen more than 15,000 people being laid off in the past few weeks as the labour intensive sector is losing sheen owing to multiple factors, including the escalating trade war between China and the U.S., liquidity crisis at home and issues related to the Goods and Services Tax.
Since December 2018, almost one lakh people, mostly workers working in the sector that includes factories engaged in cutting and polishing rough diamonds, have lost their jobs, making it the worst crisis since the global slowdown in 2008.
It may be noted that India is the world’s largest cutting and polishing centre of rough diamonds, processing as many as 14 out of every 15 rough diamonds in the world. And more than 95 % of diamonds are cut and polished in several thousands factories in Surat and other towns of Gujarat.
In Surat alone, as many as seven lakh people are employed in more than 3,000 small and medium factories in the south Gujarat city. On Tuesday, Surat’s leading diamond group, Godhani Gems, laid off 550 workers as slowdown is becoming entrenched, making the business unviable.
“Yes, workers are being laid off due to multiple factors as the economic slowdown has severely hit the business,” said Dinesh Navadia, former chief of Surat Diamond Association and currently chairman of Gems and Jewellery Export Promotion Council (Gujarat region).