Indian Competition

By Ramesh Akkineni

from an article in Business Standard by Pallavi Aiyar
The first wave of Indians began to wash up on Antwerp's shores in the 1970s. They started at the bottom of the business with low-quality roughs that were of little interest to the established diamantaires. These stones were sent to family members back in India, where labour costs for cutting and polishing were a fraction of those of Antwerp.

Three decades on, the Indian community in Antwerp consists of around 400 families, a majority from the single town of Palanpur in Gujarat. Companies that began as one-man operations dealing with a handful of diamonds at a time, have been transformed into billion-dollar-plus global enterprises, employing thousands of workers with factories and offices dotted across the world.

The ingredients for this Indian success story include cheap labour, large families and a willingness to work harder than the competition. The cost of polishing and cutting diamonds in factories in Surat, the diamond manufacturing centre of India, are up to a tenth lower than in Europe. "For most of the world, India is synonymous with outsourcing, but for us it's all about home-sourcing," quips Dilip Mehta, CEO of Rosy Blue, an Antwerp-headquartered company that bills itself as the world's largest diamond manufacturer.

"When we started out in the business, we had no competition at all because we were the only ones interested in the lower-value diamonds," adds Santosh Kedia, a diamantaire who is chairman of the Antwerp Indian Association. Given India's historical connection with diamonds — the world's first diamonds were discovered here around 800 BC — the country's labour force had the advantage of embedded skills that, when properly channelled, transformed it into a world-beating force.

The large families typical of Gujarati Jains were the other trump card that allowed for the expansion of these businesses. "We always had the possibility of global distribution because a cousin or nephew who could be blindly trusted, could always be sent to any country to set up operations," explains Mehta, whose Rosy Blue has a presence in 14 countries.

And, finally, it was the Indians' "24x7 work ethic" that allowed them to pull ahead of their competitors. "We are prepared to work till late in the evening and over weekends if necessary," says Hiren Shah of Sauraj Diamonds. "No one can withstand our competitiveness because we are always willing to work harder," agrees Mehta. "We are married to our business," he adds.

For the Jewish community, this combination of factors has proved unassailable. "Business has always been important for the Jews but we cannot pursue it with the single-mindedness of the Indians," says Abraham Pinkusewitz, an orthodox Jew who runs Pinkusewitz Diamonds. "We must focus on our (religious) studies and families and we simply cannot be open at nights or on weekends." Due to religious reasons, all Jewish establishments in Antwerp are shut from Friday sundown to Monday.

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