Losses Being Assessed as Relief Operations Commence in Flood Devastated Surat
August 13, 06
India’s diamond manufacturing capital Surat has begun recovering from the floods that devastated large parts of the city earlier this week. Though certain localities are still submerged, and there are serious shortages of food, water, and other essential commodities, immediate relief and restoration operations have commenced on a large scale.
A clearer picture of the overall impact of the disaster is beginning to emerge, though places such as Katargam, Varaccha Road and Athwa Lines, which house a large number of factories were still under 5 ft of water on Friday. Estimates in the Indian press of the total losses suffered by the industry currently range from Rs 200 crore to Rs 10,000 crore ($50 million to $2 billion).
Production in Surat, which manufacturers over 60 percent of India’s total diamond exports, has ground to a halt since early this week. Operations are not likely to restart in most cases for at least another two weeks, leading to potential losses of several hundred crores of rupees.
While many diamantaires believe that it is still too early to give a definitive assessment of their losses, they discount speculative stories that have appeared about large stocks of loose diamonds being washed away in the flood waters. By and large, they say, loose stones were moved into safes and stored at higher levels as the waters began rising. The losses will be largely on account of the stoppage of production and damage to equipment and factories.
Ashok Gajera, director of Laxmi Diamond, whose laser cutting and sawing departments are located in the basement of the factory says, “It will take some time to assess the exact extent of the losses. For example, if crucial components have been damaged, then the entire machine may have to be replaced.”
Govindbhai Kakadia, director of Sheetal Manufacturing and owner of several large factories in Surat says, “The impact of the flood has been quite devastating and the losses will be large. There has been extensive damage to machinery in a number of companies.”
A few companies, such as Venus Jewel were luckier. According to Raju Shah, director of the company, flood waters did not enter the building, though the surroundings were under water. He believes that, “Operations at our plant could restart sometime next week, once the workers are able to get back to work.”
The industry estimates that in the short run a number of workers may prefer to return to their villages. “Many of the workers may prefer going back to their homes in the Saurashtra region, which has not been affected by the floods, at least for the next 10-15 days, which also happens to coincide with some big festivals. The whole industry is, however, making every effort to provide the workers with food, water and other necessities,” Says Gajera.
Normalcy is still quite far away, especially with fears about monsoon-related diseases and possible epidemics.
Meanwhile, the diamond industry has come to the aid of those affected, particularly the thousands of workers and their families whose homes and belongings have been destroyed.
“For immediate relief we have already distributed 100,000 food packets and several thousand water pouches. As a next step we are preparing 15,000 food kits, which will contain food rations for 15 days and about 5,000 household kits, which will contain basics like clothes, household utensils and sheets,” says Praveen Shankar Pandya, managing trustee, Gem & Jewellery National Relief Foundation.
The industry has already begun to firm up its plans for long term rehabilitation, “We are also planning measures for longer term assistance, like restoring houses which have been broken or washed out in the floods. These will be concentrated on the diamond workers’ segment. However, the concrete details of this will be chalked out once we have more information. We have a team in Surat which is assessing the situation there currently. We plan to collect between Rs. 200-300 million, (roughly $5-8 million). This will be collected through individual donations. We will also approach rough diamond suppliers like De Beers and Rio Tinto,” Says Pandya.
Kakadia speaks for the entire industry when he says, “We are united in providing relief for the affected people. At such a terrible time I think it is the duty of every person to do what they can to help. And I can only pray and hope that such situations, which affect the lives and livelihood of so many people do not occur again.”