Suashish closes jewellery plant

Brian Benza
Staff Writer | Friday July 20, 2012 00:00

 

The global diamond and diamond jewellery manufacturing and exporting company opened the plant eight months ago to become the second Diamond Trading Company Botswana (DTCB) sightholder, after Shrenuj Botswana, to further beneficiate the precious stones locally.

In an interview with Business Week, Diamond Hub coordinator Jacob Thamage, confirmed the closure of the plant whose establishment last year was the hallmark of diamond downstream beneficiation, employing forty people. 

'We have received communication from the owners of the company in India that they have decided to mothball the plant due to the high costs of raw material, particularly gold and other precious materials. We don't know how long the plant will be closed for or what is going to happen to the workers. We are still trying to get more information. The diamond cutting and polishing plant however remains operational,' he said.

 The fate of the jewellery plant workers is still unclear.  Efforts to get a comment from Suashish officials both locally and in India proved futile by press time.The closure of the plant will be a setback for diamond beneficiation as Suashish is one of only two DTCB sightholders to take the first step further into the diamond value chain, adding jewellery to diamond exploration, mining and polishing activities conducted locally.

In 2007, Suashish Diamonds became the first Indian company to receive DTC Sightholder status in Botswana and invested close to P15million ($2 million) to set up a 10,000 square feet diamond cutting and polishing facility in Gaborone.

The Mumbai Stock Exchange-listed company sells both polished diamonds and diamond jewellery throughout the world from a network of sales offices located in Mumbai, New Delhi, Hong Kong, Dallas and Ottawa.

Suashish was expected to bring its 50 years of expertise to the local jewellery plant as it is already vertically integrated, dealing in diamond manufacturing, jewellery and retail.

The Indian group specialises in state-of-the-art jewellery plants and boasts of capacity to produce 1.2 million pieces annually.

In Botswana, jewellery manufacturing has been identified as one of the beneficiation avenues as the country nudges ahead with ambitions to be involved in all phases of the diamond value chain.

Already, Shrenuj Botswana has said that it will invest up to $100 million (P750million) over the next two years to establish and operate a combined diamond cutting and polishing and jewellery making factory in Gaborone. Shrenuj, one of Botswana's 21 local DTC sightholders, exports its goods to the United States under the terms of a trade arrangement.

 'There are interesting times ahead for Botswana and we very much want to be part of the changes that Botswana is set to experience in the next few years,' he said. 'Our two plants in Gaborone will be integrated into one huge plant. Construction of the factory is estimated to cost about $10 million while our costs, including our working capital, should be between $80  and $100 million.' company chairman Shreyas Doshi told Business Week in an earlier interview He added that the company, which has an annual turnover of $580 million, has plans to open a retail outlet for jewellery in Gaborone.