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Indian Diamond Industry Urged to Opt for Cash Over Credit
Sep 6, 2015 3:05 AM
By Times of India
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RAPAPORT... Venus Jewels head Sevantibhai Shah has advised the diamond manufacturers to banish the long-term credit system and adopt cash transaction to bring out the Indian diamond industry from the jaws of the ongoing recession, The Times of India reports.
Speaking at a session organized by the Southern Gujarat Chamber of Commerce and Industry on September 1, Shah said that diamantaires in Surat who manufacture large-sized stones have been doing business in cash from the last five to six years. Not a single diamond manufacturer is facing any problem, including his own. The buyers of big-sized stones from abroad are willing to pay cash.
On the other hand, around 95 per cent of the diamond manufacturers and dealers of polished diamonds are dealing on the credit terms ranging from 90 days to 190 days. In these circumstances, there are 100 per cent chances of the buyers defaulting on the payments. This is the reason why the industry witnessed a series of defaults in the last one-and-a-half-year, according to the report.
"Long term credit is literally killing the diamond industry. I urge the diamantaires to unanimously accept the cash system to prosper. None of the rough diamond mining companies offer credit to their clients. The diamantaires needs to take lesson from the business model of the mining companies" said Shah.
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Tags:
credit, India, Surat, Times of India
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