Stéphane Fischler, President of the International Diamond Council, founding member of the European Council of Diamond Manufacturers, Vice President of the World Diamond Council and President of the Antwerp World Diamond Centre talks to Manisha Gupta on India's CNBC-TV18. He shared his view of the Indian diamond industry and the road ahead for its diamond market. An abbreviated version:
CNBC: How do you see diamond consumption growth in India?
Stéphane Fischler: Twenty years ago, diamond was not a big retail product in India. But thanks to the council (Gem and Jewellery Export Promotion Council) and mining companies such as Rio Tinto, Indian consumers have developed a taste for diamonds. They have now found their rightful place in Indian retailers' shops.
CNBC: Prime Minister Modi wants India to be the biggest international diamond trading hub. What challenges does it face?
SF: India is facing many challenges to becoming a global trading platform. Belgium has developed into the leading trade hub for very specific reasons. We have concentrated on the long term. We have developed dedicated infrastructure as well as a tax system. We have focused more on brains than the work force and have undertaken much R & D. This is why we have been able to remain the leader in the trade. India has no shortage of brains, but it focuses overwhelmingly on cheap labor, which I think is a mistake. India should focus on developing skills and technology.
CNBC: What is your take on the global supply-demand curve going forward?
SF: All of the numbers indicate that in the next ten years, the supply (rough diamonds) and demand (polished) curve will be very favorable for the industry.
CNBC: Favorable for industry, but expensive for consumers? What is your sense of prices going forward?
SF: There will be a natural consolidation. Like in any industry, those that do not create added value will leave. It's a tough business. You have to keep your eye on the ball, you have to take risks, understand your product and your customer. I think we will see a different industry ten years from now. The State Bank of India has a role to play, to discover the next big company. They have to go find those small companies with a vision, a plan, with guts and ethics.
CNBC: Diamonds are no longer a niche product in India. What are your expectations for diamond retail in India?
SF: In terms of retail demand, India is the next frontier. I am very optimistic for growth in the diamond retail sector if everybody works together. We in Belgium are happy to contribute. We have contributed in the past to India's manufacturing center, sharing our skills and experience, and will be happy to contribute to make the retail sector in India one of the excellent ones in our industry.
CNBC: Demand growth in the Indian diamond retail market has been between 10-12%. Do you see that pace continuing?
SF: I believe there will be close to 10% growth in the Indian diamond retail industry going forward.
Watch the full interview here.