De Beers? decision to cut the number of Indian sightholders (clients) under its global rough diamond distribution plan will hurt the domestic diamond industry as there is already a shortage of rough diamonds in the world market and this move will further cut supply of rough diamonds to the domestic market.

The Diamond Trading Company (DTC), the rough diamond distribution arm of the De Beers which recently unveiled its new global rough diamond distribution plans as well its new list of sight holders and 75 sight holders for the contract period 2008-2011, will be offered rough supply via DTC London and South Africa.

?There is a shortage of rough diamonds worldwide and Indian firms are paying about 10% premium in the open market sale, leaving DTC sale. With this cut instituted by DTC, Indian firms will have to pay 15-20% more premium in open market buying,? Sanjay Kothari, chairman of Gem and Jewellery Export Promotion Council (GJEPC), told reporters.

?This move by DTC will consolidate the rough business in a few holds only and small and medium firms dependent on roughs though intra-trade dealing with sightholders will discontinue. This will lead to massive unemployment in the sector and affect medium units,? he said. DTC is the world’s largest supplier of rough diamonds, handling nearly 40% of the world’s total supply by value.

Of these 75 sightholders, six are new applicants, including three Indian sightholders.

The new sight holders listed from India are AS Exports, Dharmanand Exports and Sharu Gems while eight de-listed from DTC sightholders? list are B. Vijaykaumar, Bhansali & Co, D. Navinchandra & Co, Classic Diamonds (India) Ltd, Livingstones, S. Vinodkumar, Shree Ram Krishna Export and Suresh Brothers, according to industry sources. Surprisingly, three major Indian companies owned in Belgium (Gembel NV, Jayam NV and Super Gems Holdings) who are supplying their rough diamonds to Indian small and medium diamond manufacturers in the country have also been dropped from the new list.

However, DTC has not officially announced this new list and will not release it until March 2008, but names of the winners and losers are being circulated throughout the industry.