The recent decision of KP scheme to partially allow Zimbabwe to sell its diamonds has come as a respite for Surat, the biggest diamond processing centre in the world.
In fact, now diamantaires in Surat can officially import rough diamonds from the troubled Marange diamond mines in Zimbabwe with the Kimberley Process allowing supervised exports of diamonds from Zimbabwe.
KP reached an agreement that will enable the renewal of rough diamond exports from Marange diamond fields. The consensus agreement included non-governmental organisations, governments and industry representatives from World Diamond Council (WDC), International Diamond Manufacturers Association (IDMA) and the World Federation of Diamond Bourses (WFDB).
For nine months, KP blocked Marange exports, until such time that the country could demonstrate that it was in compliance with Kimberley Process Certification Scheme (KPCS) demands. However, the diamantaires and rough importers were facing a tough time bringing rough diamonds into the country without KP.
Sources said Zimba diamonds have a huge market in northern belt of the country such as New Delhi, Punjab and Chandigarh. The rough traders in the market are eagerly waiting for the supply to start from Zimbabwe.
Zimbabwe has a stockpile of rough diamonds worth $2 billion. The market is facing a huge shortage of rough diamonds and the fresh supplies from Zimbabwe is likely to set the market on fire.
Following the latest development, the rough dealers and traders have stopped taking new contracts, fearing the entry of Zimbabwe diamonds may bring down the prices of rough diamonds.
The market is expected to be flooded with Zimbabwe stones in the next few days. Thus, traders have stopped dealing in fresh stocks as the prices of rough stones are likely to come down.