Tension in Indian diamond hubs as China ‘raids’ Hong Kong offices over smuggling allegations

According to sources in the gems and jewellery business in Surat a Gujarati diamond merchant was picked up for questioning by the Chinese authorities and released on Sept 1. The Gems and Jewellery Export Promotion Council (GJEPC), Gujarat Zone, has urged the government to help diamond merchants from India in Hong Kong.

 With a view to evade customs duty of 4 per cent, diamonds are often smuggled from Hong Kong to mainland China. China is a hub of manufacturing of diamond-studded jewellery. According to Dinesh Navadia, GJEPC Gujarat Zone Chairman Chinese officials have picked up 120 people in raids carried out at various places in different cities so far.

 The Council has urged the Government to send a message to the Indian Embassy and instructing them to help the Indian diamond traders there. Many Indian diamond merchants have manufacturing units in Surat and trading offices in Hong Kong, which is a free trade zone.

Quite a few of these diamond trading firms, are run by Indians with locals as staff who often send parcels to Shanghai, Shenzhen and Guangzhou in mainland China.