Surat diamond exporters flock to Dubai

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Ahmedabad, May 6: Surat-based diamond exporters have begun diverting their rough diamond business from Antwerp to Dubai due to better infrastructure facilities and tax benefits offered by the Dubai government. Not only that, recents raids on a few diamond companies at Antwerp by income tax authorities and government inquiries faced by the Surat based at Belgium too have added to the woes of the exporters.

Speaking to FE, President of Surat diamond Association Mr Nanubhai Vanani said, “Recently Belgium Government has increased taxes on rough diamond business. On the other hand Dubai government has developed two buildings specially for diamond industry within the Free Trade Zone (FTZ).”

With India accounting for about Rs 55,000 crore of annual export of polished diamonds, gems & jewellery and approximately 11 out of 12 polished diamonds in the world being processed in India, the country is a significant player in the business. Of the total diamonds processed in India, about 90% are cut and polished in the nearly 10,000 units in Surat. The Surat diamond industry imports more than 50% rough diamonds from Belgium for cutting and polishing. Lately, however, some business of rough diamond has gradually started moving toward Dubai as a few Surat-based big export houses have purchased offices at Dubai FTZ.

According to Mr Pravinbhai Nanavati, secretary of Gujarat diamond bourse, “Earlier exporters were not permitted to purchase real estate in Dubai, but now things have changed and Dubai government is allowing foreign traders to purchase properties on ownership bases. Even Dubai government has simplified tax structure. Such measures have attracted Surat-based diamond traders to shift their rough diamond business to Dubai though diamond traders are preferring to retain their set ups in Belgium as well for the time being.”