GJEPC: Surat Production ‘Back on Track’ by early September
August 27, 06
Industry associations like The Gem & Jewellery Export Promotion Council (GJEPC) and Gem & Jewellery National Relief Foundation (GJNRF) are making working to ensure that the production in India’s diamond manufacturing capital, Surat, gets back on track shortly.
According to GJEPC Chairman Bakul R. Mehta, “Of the about 6,000 cutting and polishing units that operate from Surat, 1,000 are believed to have been totally damaged, while 2,000 units have been passively affected. While all the machinery in the 1,000 units will have to be replaced, the electrical circuits and connections in almost all diamond manufacturing areas have been completely destroyed.”
Mehta believes that factories are not likely to start operations in full swing until the first week of September.
Mehta estimates that the industry has suffered a production loss of about $600 million due to the impact of the recent floods in Surat, but reiterates that no loss of stocks in trade has been reported. He adds that, “the floods have definitely disturbed the entire supply cycle of diamonds to the international markets and as clients do not like to carry inventories, the total exports of gems and jewelry is likely to receive a setback to some extent.”
Mehta estimates the total revenue loss to be between Rs 15,000 -18,000 million ($322 - $386 million) which is due to loss of plant and machinery, wage losses and losses on account of personal belongings of workers.
A team has been sent to survey further losses and reports are expected soon on the assessment of the long term needs.
The GJEPC also states that on average, about 80 workers are directly employed per unit. Therefore, around 200,000 workers have been affected directly by the floods. The industry has also witnessed a mass exodus of labor with 50 percent of the workforce fleeing Surat following the devastation. Mehta states that it is a mammoth task for the diamond industry to retain and recall these workers to continue working in the units.
The industry has immediately acted and provided relief not only to their workers but also to the entire town by way of food packets, water pouches and medical supplies. Under the banner of the GJNRF, 24 medical camps with 167 doctors have been set up.