In a surprising turn of events, Kiran Gems, a prominent player in the jewelry industry, has closed its operations in Surat and shifted its business base to Mumbai.
The move comes as a blow to the ambitious Surat Diamond Bourse (SDB) project, inaugurated by Prime Minister Narendra Modi just a month ago with the vision of elevating Surat to India’s diamond capital. Despite showcasing its trading hub at the SDB in a recent video, Kiran Gems’s decision to relocate casts doubt on Surat’s potential as a diamond business hub.
With a registered capital of Rs 71 crore and a paid-up capital of Rs 20.98 crore, Kiran Gems Private Limited generated a substantial revenue of over Rs 500 crore in the fiscal year 2021.
Surat’s diamond merchants invested around Rs 3,400 crores to build the world-class diamond business hub at SDB, featuring 2,500 offices over an area of two lakh square feet.
The setback raises questions about the viability of Surat as a diamond trading destination, with industry insiders suggesting Mumbai’s comprehensive amenities and facilities as a primary factor in businesses favouring the city.
While Vallabhbhai Lakhani, the founder of Kiran Gems, had previously decided to shift the company to Surat, the recent move to Mumbai indicates concerns about increased costs, travel time, and inflation.
Despite the setback, the SDB committee members have unanimously agreed to Kiran Gems’ shift, aiming to maintain operational continuity in both Mumbai and Surat until SDB is fully operational. The incident underscores the challenges in establishing Surat as a diamond hub, with businesses weighing factors like infrastructure, convenience, and established networks.