Rediff.com  » Business » Long holiday sparks job cut fears in diamond industry

Long holiday sparks job cut fears in diamond industry

December 16, 2008 10:33 IST
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The Surat diamond industry has once again extended its vacation, fuelling speculations of retrenchment of workers, as global recession has severely affected the sector.

"The vacation has further been extended and now all units, which shut before Diwali, will reopen on January 1," Diamond association representatives said.

However, a few units have reopened today, the representatives added. Industry insiders say they are looking at more than 30 per cent cut in the production that would lead to retrenchment of workers and reduce staff strength.

"First, the association announced that units will reopen on December 7, then it was extended to December 15 and now it's been further extended till January 1," Surat diamond workers' association President Babubhai Jirawala said.

He added that around 20 per cent units, which are based on outsourcing work, may not reopen at all. "The industry is in very bad shape and many workers are likely to lose their jobs in the industry," he said.

"Since the international market still remains in turmoil and there is no sign of recovery in the near future, we have to cut down production and go for cost cutting measures," said Lalit Gajera of Laxmi Diamond, which reopened today after one and half months.

The staff strength reduction will happen with cut in production. The industry has seen such severe crisis for the first time, he said. Former president of Surat Diamond Association Pravin Nanavaty said, "There is no demand at all from the international market and particulalry from the US and European countries."

"Christmas is round the corner and this is supposed to be a boom time for the industry due to orders from Europe and US," he said, adding, "instead of a boom, we are not even able to reopen the units."

He also fears that there is going to be retrenchment of workers from the industry.

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