As the European Union (EU) is bringing in norms to stop the direct import of rough and polished diamonds from Russia, Surat’s diamond industry is in for trouble.
The tougher norms are likely to be implemented from January next year. The EU also plans to introduce a traceability mechanism from March 2024 to ensure processed Russian gems are not imported into third countries including India. The mechanism will be coordinated with the G-7 countries, which include the US, Canada, Britain and Japan.
The Gujarat Diamond Workers Union had made a representation to the delegates of G-7 countries who visited Surat earlier. They said the ban would affect the livelihood of 20 lakh jewellers in Gujarat, including Surat. However, current developments indicate that these representations were not considered.
EU is considering new sanctions against Russia over its invasion of Ukraine. The sanctions ban the import of diamonds and liquefied petroleum gas from Russia and strict enforcement of price caps on Russian oil. There are also restrictions on the transfer of goods and technology that could boost Russia’s industrial capabilities.
Members of the European Parliament want the European Commission and EU member states to impose a total ban on the marketing and cutting of diamonds of Russian origin or those re-exported by Russia to the EU. If this happens, the livelihood of thousands of people in Surat, the hub of diamond cutting and polishing, will be affected.
EU member states say legal avenues should also be explored to seize frozen Russian assets and use them to rebuild Ukraine. The ban proposal will be discussed by the 27 European Union member states, but a final agreement is likely to take weeks.