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Diamond Trouble: Mumbai’s Resilience Challenges Surat’s Ambitions

Setback for Surat Diamond Bourse as Business Shifting Back to Mumbai

Mumbai | January 23, 2024 : In a surprising turn of events, Gujarat’s ambitious move to shift the diamond business hub from Mumbai to Surat has encountered a significant hurdle. The Surat Diamond Bourse (SDB), inaugurated with much fanfare by Prime Minister Narendra Modi on December 17 last year, is now grappling with challenges, just a month into its operation. Despite being the world’s largest office building with over 4,200 diamond trading offices, the SDB faces a setback, with renowned diamond merchant Vallabhbhai Lakhani, a key player in its establishment, reportedly planning to relocate his business back to Mumbai.

Before the establishment of the Surat Diamond Bourse, Mumbai held the status of the financial capital and a central hub for the diamond trade in the country. However, the opening of SDB aimed to elevate Surat as a prominent center for jewelry and diamond trade. Unfortunately, the reality seems to be different, as the geographical inconvenience between Surat city and Bors, coupled with a lack of public transport, hinders the smooth operation of the diamond bourse. Compounded by the reluctance of employees to migrate, the diamond business appears to be reverting to Mumbai.

Vallabhbhai Lakhani, associated with Kiran Gems, played a pivotal role in establishing the Surat Diamond Bourse. However, due to a perceived lack of cooperation from other Mumbai traders, Lakhani is contemplating relocating his business back to Mumbai. The unwillingness of Mumbai-based diamond traders to shift their base to Surat, along with the inconvenient location of the bourse, is resulting in a migration back to Mumbai for both employees and laborers.

The impact is evident as Kiran Gems, the largest company in the Surat Diamond Bourse, has experienced a decline in revenue since the shift of business to Surat last month. The company is now taking steps to continue its operations from Mumbai.

The situation has also sparked political tensions in the state, with opposition parties criticizing the state government over the exodus of businesses from Maharashtra to Gujarat. The Surat Diamond Bourse, equipped with cutting-edge facilities such as a customs clearance house for import and export, a jewelry mall for retail jewelry business, international banking, and secure vault facilities, is now facing challenges that threaten its envisioned role as a diamond trading powerhouse.

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