An Assignment Report On

Economic Factors Affecting Diamond Market (surat)

Subject: Marketing Management Year: S.Y.B.B.A.(Sem. III) Submitted To,

Miss Jagruti Madam

Submitted By,
Makawana Satish (54) Mandlecha Abhinav (55) Meghani Vijay (57) Mehta Pooja (59)

Registered To,
Bhagwan Mahavir College of Business Administration (Veer Narmad South Gujarat University)

: Introduction : To : Surat Diamond Market :

India leads the globe in diamond manufacturing with 60% share in value, 85% in volume and 92% share in the number of pieces produced. In India, the diamond processing units are mainly located in Gujarat, particularly in Surat, Navsari and some parts of Saurashtra & north Gujarat region. About 80% of country's diamond processing work is being done in Gujarat, out of which more than 50% is conducted at Surat only. Surat city is known as DIAMOND CITY of India. Currently, there are more than 6,000 diamond-cutting units in Surat. It employs about 15 lakh people directly and provides employment opportunities to more than 25 lakh people. There are innovation in product by improvements in its 4Cs (cut, carat, color and clarity). There are about 7000 different types of diamonds.US market has great demand for fancy cut diamonds processed in India. The popular cuts are: Round shape, Princess, Emerald, Assher, Marquise, Pear shape, Heart shape, Step cut, Baguettes, Tapers, etc. The cut and polished diamonds are exported to USA, Japan, Belgium, Hong Kong, Switzerland and Thailand. Of these, USA, Japan and Switzerland are consumer markets and the rest of them are trading countries. It is mostly the same commission agents who supply roughs to the firms on behalf of the sight-holders, who also take the finished product for export. In Surat there are two main diamond marketplaces: (I) Mini Hira Bazar (II) Mahidharpura Moti Bazar 1

: Economic Factors Afeecting : : Diamond Market :

(1)Currency Exchange Rate:
This is the first and more influencing factor which affects the Surat diamond market. Everyday there is higher and lower changes in foreign currency rate. Dollar ($) rate is more influence to the diamond market. If the dollar rate is increase, the rough diamonds have higher price for the entrepreneur. While the dollar rate is gone decrease, the polished diamond will sell in lower rate. So, the foreign currency exchange rate is more affecting factor to the diamond market.

(2)Level of Income:
There is different level of income in Surat diamond market. Many persons involved with diamond business in Surat. Such as workers, managers commission agents, entrepreneur etc. They work in diamond market as their skill and earn money. Workers are work in diamond factory and polished the diamond and give it different shape and over the month they get salary. This salary is depends on their work. Commission agents have many contacts between diamond parties and diamond suppliers. They get income as per the rule of commission.

(3)Inflation:
Inflation is also influence the diamond market. If inflation rate is gone high, diamond cost is also gone high but selling price of polished diamond is remain low. So, the entrepreneur makes the loss. Because of inflation there is price rise in each and every market, price of diamond equipment and tools is rise and diamond cost is gone high. By this way, inflation is affect the diamond market.

(4)Investment in Other Business:

This is the important factor which affect the diamond market. There are many diamond businessmen, entrepreneurs, manager and other persons who are engaged with diamond business are invest their money in other business. For example, they invested their money in land & property, because of this investment the price of land & property is going rise. Likewise they invested their lots of money in embroidery business and share market. Because of these investments, more money is gone to this type of investment from the diamond market. By this way diamond market is gone dullness.

(5)Ruptcy in Diamond Market:

In currently times there are many ruptcy in diamond market. Because of this ruptcy there is more money implicated of businessmen. There is more loss of diamond and money in this situation. But that person who makes ruptcy in diamond market, he loose his value and personality in diamond market and nobody is ready to put trust on him. So, ruptcy is also included in economic factors which affect the diamond market.

(6)Demand for Diamond:

Mostly polished diamonds are exported to United States of America (USA), Japan, Belgium etc. In this country there is consumer market for diamond. The people from these countries demand for diamond and its different items like diamond ring, diamond necklace, diamond ear-ring and diamond jewelry etc. If the demand for these things is increase, the export of diamond will also increase because most of polished diamonds are prepared in Surat. If the demand for diamond is decrease, the market of polished diamonds will show slowness. So, demand for diamond is also necessary to growth the diamond business.