Mumbai Diamond Traders Express Doubts About Surat Diamond Bourse’s Appeal

Surat : The Surat Diamond Bourse (SDB) is wooing Mumbai traders to open shops in its recently constructed, record-breaking office complex, but a big question remains: why move when Mumbai’s Bharat Diamond Bourse (BDB) is already a bustling hub? A trade conference held recently by SDB itself at the BDB in Mumbai was dominated by this topic.

Citing the success of his own firm as an example, SDB chairman and BJP Rajya Sabha MP Govind Dholakia advised Mumbai traders to take use of their newly acquired premises in Surat. “SRK is what it is today all due to the Bharat Diamond Bourse,” he said. “After opening offices at BDB, more than 500 diamond enterprises have grown to be very successful. With Surat Diamond Bourse, everything are the same.”

But these assurances don’t seem to have satisfied Mumbai merchants. There is a lot of weight to the BDB’s established infrastructure and convenience. One unidentified trader noted, “Surat is the manufacturing centre and all diamonds are bound to Bharat Diamond Bourse (BDB) for global exports. “Why then must we move to Surat?”

Majority of the Mumbai traders attended the meeting due to sheer respect of Govind Dholakia, chairman of SRK. Dholakia and his company SRK has earned a good reputation in India and abroad due to its business transparency and ethics.

The lack of essential infrastructure in Surat adds to the scepticism. “I have an office space in Surat Diamond Bourse, but we are not going to start until and unless there are customs clearance facilities and international flights from Surat to key international destinations,” said Dhiraj Shah, another dealer.

The current state of the diamond market adds to the appeal of a move. “Dwindling demand of polished diamonds in the international market is the reason why the diamond market is in recession,” Shah said. “Opening an office in Surat initially requires a large initial investment that many traders cannot afford.  Most traders live in Mumbai with their family, hence it is unacceptable to shut down between Mumbai and Surat without cause.”

Industry sources speculate that by assigning Arvind Shah, also known as Arvind Dhanera, to a prominent role, SDB may be hoping to draw in the powerful Jain community, especially the “Shahs” from Palanpur, Gujarat. SDB has promised smaller traders tables and places, but these don’t seem to be enough to lure established Mumbai companies away from the BDB’s well-functioning network.

“The ability of Surat Diamond Bourse to address these issues will determine whether it can really become a global diamond trading hub. Can it build a whole and competitive infrastructure with effective international connectivity and logistics, a BDB member questioned? “Only time will tell if Surat’s ambitious project, which claims to be the largest office block in the world, will draw Mumbai’s diamond traders or if it will remain a mostly empty monument.”