Surat diamantaires Suffers Rs 500 Cr Losses as Lab-Grown Diamond Company Goes Bankrupt

Surat : Surat, the world’s largest diamond manufacturing center, has been hit by a significant blow as several prominent diamond companies have incurred substantial financial losses to the tune of over Rs 500 crore following the bankruptcy of a leading lab-grown diamond company.

The lab-grown diamond company, which had been operating in Surat since 2013, managed to lure diamond industry stakeholders with lucrative business offers, enticing them to invest in diamond-growing greenhouse machines for the production of lab-grown diamonds.

Promising that the lab-grown diamonds would command a price of $320 per carat in the international market, the company persuaded diamantaires from Surat and Mumbai to invest in their venture.

The diamond company owners, drawn in by the prospects of high returns, eagerly contributed substantial amounts of money for the purchase of the diamond reactor machines, priced at Rs 1.50 crore each. However, the unfortunate reality soon unfolded, revealing that the machines provided were of low quality and inefficient in their intended purpose.

What is a diamond reactor?

The best seeds are carefully positioned on a metal disk to be placed inside the diamond-growing greenhouse.The metal disk with the diamond seeds is placed inside a diamond growing reactor and uses both processes – High Pressure High Temperature (HPHT) and Chemical Vapor Deposition (CVD).Over the next 10 to 12 weeks, the seeds go through various processes. A combination of gases, pressure and temperature create an environment that allows carbon atoms to break down and rain upon the seeds. As weeks go by, atom-by- atom, layer-by- layer, the seeds transform into rough diamonds..These rough diamonds acquire the same chemical, physical and optical properties as mined diamonds, through both, the HPHT and CVD processes.

The rough diamonds are then cut and polished to exacting standards in our high tech factory.

To exacerbate matters, it has been discovered that the lab-grown diamond company had diverted a significant portion of the invested capital towards purchasing real estate in foreign countries, particularly in the United States. With the company owners now in hiding, the diamond company owners find themselves grappling to recoup their investments.

The repercussions of this unfortunate event have sent shockwaves throughout the diamond industry in Surat, with companies facing substantial financial setbacks. The loss of crores of rupees has dealt a severe blow to the stability and growth of the industry, which has long been considered a pillar of Surat’s economy.

Lab-grown diamonds have gained popularity in recent years due to their ethical and environmentally friendly production methods. However, this incident raises concerns about the credibility and transparency within the lab-grown diamond sector. It serves as a cautionary tale for industry stakeholders, urging them to exercise utmost diligence and scrutiny when considering investments and collaborations.

As efforts to recover the invested money intensify, the affected diamond company owners have initiated legal proceedings against the lab-grown diamond company. They seek justice and a swift resolution to this unfortunate chapter in Surat’s diamond industry history. Furthermore, discussions among industry players are underway to explore measures to prevent similar incidents and safeguard the reputation of Surat as a global diamond manufacturing hub.