Diamond factory in Surat reinstates 100 workers after union pressure

Surat Diamond Association President Jagdish Khunt said, “The shortage in rough supply started after the Ukraine-Russia war when sanctions were placed on the Russian diamond miner Alrosa. Additionally, De Beers, the supplier of rough diamonds worldwide, had also curtailed its production. The industry was already passing through a bad phase with the diamond factory owners reducing production. Then came the news of US tariffs… it could lead to survival challenges for some industry players. The diamond exporters have large unsold inventory and to add to it, the Christmas demand in the US market has also not picked up, as the diamond merchants in the US and India are unsure about the tariff charges. Some of the parties in India have started negotiating with their US counterparts about who will bear the tariff but as of now there is no amicable solution.”

“Most of the merchants of India (from Surat and Mumbai) buy rough diamonds from the Diamond Trading Corporation (DTC) identified traders while others get directly from other countries,” Khunt added.

A diamond firm owner on condition of anonymity said, “Till February 2025, around 200 people were working in my diamond factory and now only 80 are left. I am a small player and my money is jammed in the inventory, as there is no demand for polished diamonds. I cannot bear the burden of paying salaries to the polishers without work, so they were told to leave. The diamond merchants to whom we were selling polished diamonds have cut short their purchases due to the US tariffs.”

The US is among the major consumers that buys around 40 % of the world’s loose, cut, natural and polished diamonds and jewellery, another expert told The Indian Express.

Talking about the layoffs, Krish Diam company manager Dilip Mangukiya told The Indian Express, “Our factory works for different diamond trading firms of Mumbai. After cutting and polishing rough diamonds, they are sent back to these companies, who later export to the USA and other countries. We have approximately 300 staff members working in our factory in Surat. For the last few days, the company had been facing a shortage of rough diamond supply, as a result of which the diamond workers were sitting idle. We could not afford to pay their salaries, so the owners instructed us to let some of them go. We had also paid hundreds of diamond artisans and instructed them to find alternative employment.”

Diamond polisher, Rajesh Vachhani (40) who was also laid off and hired again, said, “I had been working in the factory for a long time. The workers earn between Rs 18,000 and 35,000 in a month. The factory management had not even given us any notice before firing us. But, we are happy now after being hired again. Hopefully, the situation will be better in the coming days.”

After being laid-off, the diamond workers had approached the Diamond Workers Union of Gujarat (DWUG) office in Surat for intervention. On Thursday, the DWUG leaders contacted the company and discovered that the firm’s owner and partners were in Mumbai on a business trip. A discussion was held with the company’s general manager Mangukiya, and the DWUG representatives, during which the manager consulted the owners and, after obtaining their consent, agreed to rehire the laid-off diamond workers, said sources.

According to Mangukiya, the union leaders had presented two options — either their jobs back or three months’ salary. The firm opted for the former.

“The diamond industry is facing major problems. Some of the factories have minimised their production while many others are closing the factory two days a week,” Mangukiya said.

Meanwhile, Diamond Workers’ Union Gujarat Vice President Bhavesh Tank said, “Diamond workers being laid off before Diwali is not good. We know that the diamond industry is going through a challenging phase, but it is our appeal to the owners not to lay off the workers.”

In the case of Krish Diam, the workers were not even given any notice, he said.