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This story is from August 5, 2005
China cautions Indian diamond merchants
Chinese authorities have cautioned Indian diamond merchants against joining an illegal diamond exchange that is coming up in Gaungzhou.
SHANGHAI: Chinese authorities have cautioned Indian diamond merchants against joining an illegal diamond exchange that is coming up in Gaungzhou, the largest city in south China. Organisers of this new exchange are believed to have visited India, and tried to persuade Indian merchants to become its members, sources said.
"We want to inform Indian businessmen that they should not join any illegal or unregistered diamond centre.
Industry sources said that a group of Chinese businessmen are trying to set up a parallel and privately-run trading centre for diamonds in Gaungzhou, in order to meet the needs of jewellery makers who produced jewellery for imports. The proposed trading centre has managed to obtain some support from the diamond industry across the world, sources said.
Indian merchants play an important role at the official Shanghai Diamond Exchange, and account for 20 of the 105 members in it. The number of Indian merchants setting up offices in Shanghai has grown rapidly in the past two years, and several more are expected to do so in the near future.
However, foreigners are only allowed to do whole selling. They are allowed to do retailing, Hiren Shah of Amy Diam, an exchange member, said.
Yu said he was worried that organisers of Gaungzhou centre might manage to mislead some of the Indian diamond merchants into joining the illegal centre, and thus woo them away from the Shanghai exchange. It would also harm the interests of diamond consumers if the goods were routed through the unregulated centre.
"I have information that organisers of this centre have visited India and tried to get them to become its members. I think they are also trying to get members from Europe and Russia," he said.
He said that the local government in Gaungzhou is actually encouraging the setting up of the illegal centre and he has brought this issue to the attention of the ministry of commerce in Beijing.
"I am told that the ministry of commerce has asked the Gaungzhous local government to stop encouraging the illegal centre," he added.
"We want to inform Indian businessmen that they should not join any illegal or unregistered diamond centre.
The Shanghai diamond exchange is the only legal channel for export and import of diamond in China," Yu Huimin, secretary-general of the Diamond Administration of China, the official supervisory body, told ToI in an exclusive interview in Shanghai.
Industry sources said that a group of Chinese businessmen are trying to set up a parallel and privately-run trading centre for diamonds in Gaungzhou, in order to meet the needs of jewellery makers who produced jewellery for imports. The proposed trading centre has managed to obtain some support from the diamond industry across the world, sources said.
Indian merchants play an important role at the official Shanghai Diamond Exchange, and account for 20 of the 105 members in it. The number of Indian merchants setting up offices in Shanghai has grown rapidly in the past two years, and several more are expected to do so in the near future.
The domestic market for diamonds is growing very fast in China, and there are lot of opportunities for Indian firms.
However, foreigners are only allowed to do whole selling. They are allowed to do retailing, Hiren Shah of Amy Diam, an exchange member, said.
Yu said he was worried that organisers of Gaungzhou centre might manage to mislead some of the Indian diamond merchants into joining the illegal centre, and thus woo them away from the Shanghai exchange. It would also harm the interests of diamond consumers if the goods were routed through the unregulated centre.
"I have information that organisers of this centre have visited India and tried to get them to become its members. I think they are also trying to get members from Europe and Russia," he said.
He said that the local government in Gaungzhou is actually encouraging the setting up of the illegal centre and he has brought this issue to the attention of the ministry of commerce in Beijing.
"I am told that the ministry of commerce has asked the Gaungzhous local government to stop encouraging the illegal centre," he added.
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