Diamond traders seek help from govt, RBI after coronavirus hits trade

Indian diamond houses have sought help from the Reserve Bank of India (RBI) and the government as the coronavirus outbreak hits trade, according to a report by The Economic Times.

Jewellers have approached the central bank, the commerce and finance ministries seeking an extension on the deadline to clear credit facilities taken by exporters of polished diamonds and importers of rough stones, the report said.

“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, the chairman of the Gem & Jewellery Export Promotion Council, said in a note to the central bank and government.

About 35-40 percent of the Indian diamond industry’s business is with mainland China and Hong Kong, which also serve as ports for distribution to other countries.

Over 1,100 people have died in China due to coronavirus, with over 44,000 confirmed cases. The epidemic has affected usual business operations in financial centres such as Beijing, Shanghai and Hong Kong.

“Exports will be down 30-35 percent 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 diamond exports firm Kiran Gems, told the publication.