The world’s largest diamond exchange opened in Mumbai on Sunday, as India, the largest global cutter and polisher of rough diamonds looks to establish itself as a trading hub, challenging the traditional dominance of Belgium and Israel and the new emerging threat from China.
The three million square foot (287,700 square metre) Bharat Diamond Bourse (BDB) will bring all segments of the diamond business including export and trading firms, banks, vaults, a customs department and investors under one roof, in an eight-tower complex in Mumbai’s suburban commercial district of Bandra-Kurla. India, is the third largest diamond consumer after the United States and Japan, accounting for 8 percent of global consumption in 2009 which is expected to grow to 11 percent by 2016. India is the world’s largest cut diamond exporter, with annual exports of around US$28 billion.
China is growing quickly to rival India’s dominance of the cut-diamond market. With consumption rising by four percent annually, and strong tip-ups with African mines, the Chinese diamond cutting and polishing market is gaining ground on India. With administratively aligned Hong Kong already doing brisk businesses, China imported US$26 million carats and exported US$23 million carats in 2008. It has also been noticed that diamonds have come to India via China.
De Beers, the world’s largest diamond producer with 40 percent of the market, expects India and China to be the next engines of growth for the sector, together accounting for 20 percent of consumption in 2016. The United States will retain the top spot with 37 percent.