The Gem & Jewellery Export Promotion Council (GJEPC) takes strong objection at what it calls the "maligning of the Indian financial system" in a media statement released by International Diamond Manufacturers (IDMA) President Maxim Shkadov.
“It is astonishing to note an uncalled for statement made by the IDMA President against its largest stakeholder in diamond manufacturing globally," says GJEPC Chairman Vipul Shah. "The remark made is reckless and not supported with true evidence or factual information.
"Such uncared for opinion by the highest authority at IDMA not only damages a member country but also affects the diamond trade at large and tarnishes its image globally. GJEPC has always been supportive of the current Chair at all forums, and it is really disheartening to note his appalling remarks against India, time and again," Shah comments.
He said that since the diamond business is global and the diamond pipeline spans the borders of many countries, it is unfair to pinpoint any country for any issue. "The banks and financial institutions operating in the diamond industry are also global operators and it is felt that like novices if anybody makes statements singling out any individual country, not only that is in bad taste, but it is also devoid any thought process or wisdom," Shah adds.
The GJEPC regards speculation in diamond buying as an "alarming phenomenon", and has condemned it time and again in the past, the organization said.
The GJEPC said it was appealing as a responsible member of IDMA to all other members to condemn Shkadov's "unilateral statement which causes more harm to the cause of the diamond manufacturing community rather than helping it.
"GJEPC believes such irresponsible prescriptive opinion should not be imposed upon responsible members, which disturbs the world order in diamond industry," the statement adds.
The GJEPC said that India is one of the most compliant and responsible nations in the world in terms of conducting diamond business ethically both in Kimberley Process and best business practice standards.
In his statement, Shkadov claimed that: "In India in particular, bankers have allowed clients from the diamond industry to use funds that were provided and earmarked to finance purchases of rough diamonds and for manufacturing to serve the narrow and destructive interest of speculating on rough prices. Add to that the infamous phenomenon of round-tripping of diamonds that was so brilliantly exposed by a well known industry commentator and you have identified some of the circulatory problems that our industry has been experiencing in recent years.
"It seems that some of our own members have forgotten that bank financing is provided to purchase rough and to produce polished diamonds, and not to be used to finance non-related projects, thereby arm wrestling the rough. Banks which provided easy credit to clients who consequently allocate it to carry out financial trickery cause unscrupulous players to pay crazy prices for rough."