MUMBAI, January 16: Diamonds, they say, are forever. But not for hundreds of units engaged in cutting and polishing of diamonds and producing jewellery items at Santacruz. Half of over 60 such units at the Santacruz Electronics Export Processing Zone (SEEPZ) are lying idle due to fall in demand for the precious stones in Japan and the South-east Asia, which account for half of India's diamonds export.Diamonds account for 80 per cent of India's total exports and nearly 80 per cent of the revenue for the gem and jewellery industry is linked to exports.However, due to the economic turmoil in the South-east Asian countries, the exports have dropped by 35 per cent severely affecting the exporters. Seven out of 10 rough diamonds in the world are cut and polished in India.Labour problem too has hit hard the diamond units at SEEPZ. The unit of Suraj Diamonds India (Ltd) had reduced its workforce from around 1,500 to 300 following a strike. Its sales volume has come down from Rs 570 crore during 1995-96 to Rs400 crore in 1996-97. While Suraj Diamonds is one of the 16 major Indian companies engaged in export of diamonds, there are around 25,000 small units across the country - most of them in Surat, Mumbai and Cochin.``There is frustration among workers as their salaries and bonus level have been reduced. They are demanding 36 per cent bonus, regular increment and the stoppage of wage deduction for workers' mistakes while cutting the diamonds,'' says A K Gupte of Suraj.However, diamond workers said their salaries are arbitrarily cut for slight mistakes that occur during the course of work. According to them, diamond workers have always been at the receiving end due to lack of job security, arbitrary reduction in wages and other unfair labour practices. ``Now a case is pending before the Labour commissioner. There are small cutting centres at Malad, Goregaon, Dahisar and Vasai where workers are facing retrenchment,'' said a trade union worker.These units have been engaged in importing the rough diamondsto process and polish using cheap labour. More than half of the total processing units are in the small scale sector which thrives mainly on cheap labour in India. According to industry sources, there are around 25,000 such units across the country and 20,000 are concentrated in Surat. Kesari Exports, one of the major diamond exporters of Surat, witnessed labour unrest following the company's decision to cut all wages by at least 30 per cent.``Business has been slow and payment cycle has expanded from 90 days to one year in the USA due to recession. Either you kick out the workers or slash their salary. Workers feel frustrated because they are comparing their wages with the boom period,'' said sources in the company. Now Kesari Export has decided to rationalise the workforce by reducing the working hours to 6 hours per day as against 8 hours earlier. ``As workers are paid according to piece work, they used to work up to even 12 hours a day earning around Rs 7000 per month,'' sources said. SEEPZ attracted these units when the Gold Control Act controlled gold supply. As the restrictions on the supply have been removed, operating from SEEPZ is no longer attractive.Expecting to sell diamond in the world market, many units which imported rough diamonds for processing are baffled by the lack of demand in the world market. Many cutting and processing centres have cut production while others have closed shop. Surat city witnessed riots after the workers resorted to violence when their livelihood faced a threat due to fall in diamond exports.
