Customs dept waives off bank guarantee for Surat Hira Bourse

Surat: Diamantaires in Surat are a relieved lot after the customs department of Ahmedabad waived off bank guarantee for Surat Hira Bourse (SHB). This means that exporters in Surat would no longer have to depend on Mumbai to export polished diamonds and jewellery.

The total export of polished diamond from India is pegged at Rs 1.50 lakh crore per annum. Majority of the exports is handled by BDB at Bandra Kurla Complex (BKC) in Mumbai. The diamantaires send the diamond parcels to Mumbai for the direct export to various parts of the world.

SHB, operated by the Diamond and Gem Development Corporation (DGDC) at Katargam, had to provide bank guarantee under the electronic data interchange (EDI) system for export of high-value valuable parcels.

As a custodian, SHB was unable to pay bank guarantee for goods above Rs 100 crore. This complelled Surat exporters to send their consignments from the Bharat Diamond Bourse (BDB) in Mumbai without bank guarantee.

CEO of SHB, KK Sharma told TOI, “De-linking of bank guarantee from EDI has opened the doors for the SHB to carry out export of polished diamonds of any amount. Earlier, we had to keep certain amount reserved in the EDI for carrying out exports from Surat. In case of big export consignment of over Rs 200 crore, we were unable to process the same and that the exporters were forced to do it from Mumbai.”

According to Sharma, the annual export of polished diamonds from SHB is pegged at Rs 25,000 crore. After the delinking of bank guarantee, the export will double up in the next one year. Exporters from Surat will not have to send their parcels to Mumbai, bearing extra cost of shipment and insurance.

Atul Mehta, owner of Facet Virtue, a diamond exporter said, “Our parcels are high in value and we were facing lot of problems exporting them from SHB due to bank guarantee issue. As the problem has been resolved, we are all prepared to ship all our consignment from SHB. This will save us hugely on the transportation cost of the diamonds and other costs including agents.”

Girish Patel, chief accountant of KARP Impex, told TOI, “The parcels were held up for days due to the bank guarantee issue at SHB. Thus, we preferred to export our parcels from Mumbai. As now the bank guarantee has been waived off, we have an opportunity to use the SHB facility by exporting goods of any value.”

For Graphics

Adding to the glitter

Annual export of polished diamonds from India: Rs 1.50 lakh crore

Total export of polished diamonds from SHB: Rs 25,000 crore

Till now, SHB had to provide 1% bank guarantee on the total value of exports

After waiver, SHB aims for Rs 50,000 crore export in next one year

PIC QUOTES

“The bank guarantee waiver will allow Surat diamantaires to export diamonds of any value, which was earlier impossible. We feel that the exports is going to double up from Surat in the next one year.

KK Sharma, CEO, SHB

“When you have export facility at home, there is no question of going to Mumbai and spending extra money to export your goods. SHB is the most convenient option for the entire industry after the bank guarantee has been waived off.

Kirti Shah, diamond exporter


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