Mumbai: India’s cut and polished diamond exports in 2016/17 could rise 15% from a year ago to a value of $23 billion as demand has been improving from the United States, Europe and some Asian countries, the head of a trade body said on Thursday.

The rise in exports will prompt the world’s biggest diamond polisher to increase imports of rough diamonds by 10%, Praveenshankar Pandya, the chairman of the Gem and Jewellery Export Promotion Council said.

“Demand has been improving from the US, which is our biggest market. Buying has also improved from Europe and some Asian countries," he said.

India’s exports of cut and polished diamonds in the 2015/16 fiscal year ending 31 March fell 13.6% from a year ago to $20 billion on lower purchases from China and the United States.

The correction in exports prompted diamond polishing units to reduce imports of rough diamonds by 16.2% in 2015/16 to $14 billion.

“For the first time in many years we witnessed sharp drop in rough diamond imports last year. With improved sentiments in the polished market, we will see higher rough diamond imports this year," Pandya said.

India is a global diamond polishing hub where 14 out of every 15 rough diamonds in the world are polished.

Last year manufacturers, who cut and polish diamonds, deferred purchases of rough diamonds as prices of polished ones fell more steeply than rough prices.

Many small polishing units in Surat in India’s western state of Gujarat closed for business last year and laid off workers.

Russian diamond mining company Alrosa’s first-quarter sales rose 34% year-on-year to 12.1 million carats, the world’s largest producer of rough diamonds in carats said last week.

Anglo American-owned De Beers, the world’s largest diamond producer by value, said its rough diamond sales during third cycle of the year rose to $660 million from $617 million in the second sales cycle.

Rough diamond prices are slowly rising, but polished diamond prices are not increasing, making it difficult for Indian polishers to sustain their businesses, Pandya said. Reuters

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