The diamond industry of India is one of the world’s most valuable Industries in the country and while most of us know Surat as the diamond capital of India very few of us know that in the 1970s India was nowhere to be found in the diamond market of the world this market was very tightly controlled by the Jews of Belgium but in the next three decade a community from India did something so brilliant that they went on to become the most dominating force in the diamond market of the world this community that I am talking about is none other than the Jain community of India and the Jains have done such an amazing job that today India commands a staggering 93 percent market of the world we exported 23 billion dollars worth of diamonds and it accounts for an insane 10 of the total merchandise exports of India in fact when Gautam Adani is one of these Jains who became a diamond trader and carrier this legacy forward and this Diamond trading is the reason why he became a millionaire at the age of 20. So the question is how did the Jains take control t of the diamond industry of the world how did they beat the Jews of Belium what was the business strategy that made Jains so successful?
To understand how Jains became the legends in the diamond market we first have to understand the steps involved in the production of diamonds. The first step of the diamond process is exploration and mining here is where a diamond mining company identifies a viable diamond deposits and starts mining currently the biggest diamond deposits are in Botswana and Russia then comes the second step which is salting and valuing so once the mining is done the rough diamonds are extracted and they are sorted by size shape quality and color then these rough diamond are sold to diamond cutting companies for cutting and polising and the nake suggests diamonds are ut and polished with a high degree of craftsmanship at this point and this is where diamonds going to become the beautiful pieces of gems that we know of then the diamonds are graded and certified internationally recognized gemalogical institue and this certification is done based on four characteristics cut carrot clarity and color now I will get into the depth of grading when we cover the lab grown diamonds case study but for now all you need to know is that diamonds are classified based on four C’s which are cut carried clarity and color then based on this grading these diamonds are sold to th jewelry manufacturers all across the world who then make jewelry out of it and then sell it to the jewelry retailer and after this the jewelry retailers sells to the people like you and me thisis the value chain of the diamond industry if this is very very clear to you let’s dive into the 1950s Diamond industry this is a story that dates back to 1950s Belgium in Belgium there is city called Antwerp this is when World War II had just gotten over and 65 percent of the Jewish population in Antwerp had been eliminate by Hilter from the 15th century onwards world diamond trade was dominated by Jewish Diamond dealers.
It was vert difficult to beat the Jews because of three reasons number one Jews had witnessed the massacre of Hitler because of this they were very protective of everything from their trade to their identity secondly the Jews were so supportive of each other that if you were a Jew and you did not get a loan from the bank the Jewish community itself would offer you a loan so that you can start your business similarly as a Jew if you start cutting and polishing business then just to support you the Jewish Diamond traders will give you so that you can prosper during the initial stages and lastly even if they had a dispute the Jews appointed a jewish arbitrator who used to solve the disputes as soon as possible and they did not have to rely on the court this way the matters were resolved witout wasting time and money conflict resolution of the Jews was one of the most effectiv systems in their business os overall if you wer a jew it was easier for you t excel because of your community support but it you were anyone other than the Jews it was very difficult for you to get loans and you had to struggle a lot to get good clients this is when in the 1960s some Indians started arriving in antrope these Indians were none other than the smart and sharp Jains from Gujrat so the question is if the Jews were so dominating then how did the genes caputer the diamond idnustry in the world
Well as it turns out justl ike nay brillian entreprenueur the Hames found a gap in the market and this Gap was the small diamond market to tell you about it the genes notice that Jews wer only interested in large diamonds and they saw no value in small diamonds at all this was because of three reasons at the timethe global demand was centred majorly around large stones secondly it was very difficult to cut and polish small diamonds and since very fw people bought it it was not financially viable to spend time and labour on small diamond and because of the these problems very few people in Antwerp had developed the experties polish small stones so small diamonds as a product was neither customer desirable nor marketviable and the jews ignored them to such an extend they called it dimond dust what did they call it diamond dust but guess what this is where the jains of India spotted a million dollar opportunity since the Jes called it diamond dust the genes were able to buy this diamond dust at a very low cost and allt hanks to their close knit community the jains sent theis dust to India to check if they could develop the technique to cut and polish these small diamonds and somehow after hard world
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