Nurture, Grow, Abandon?

At a number of recent meetings in Mumbai and Tel Aviv, one issue repeated itself when speaking with some of the political leadership of the local diamond industries. At both countries government support is sought after and in both cases it seems that it is there, but to a limited degree.

In Mumbai, the GJEPC leadership met with federal ministers last week in an attempt to prompt the government to increase its support of the industry. Among the issues are financing, loans, turnover tax and more.

In Israel, the situation is similar, but worse. This week, the minister of Industry, Trade & Labor resigned. He is credited for being sympathetic to the industry and for trying to support it. But even with his reputation for being a 'bulldozer' that can moves things forward, he did not succeed in doing so for the Israeli diamond industry.

For example, during the crisis, the government decided on assisting different sectors. The assistance didn't arrive for diamond industry, and some blame the banks for this. However the expectation was that a powerful minister will have enough clout to press the banks to play along. That didn't happen. The expectations from the new minister is that "he won't interfere," as one put it.

While Israelis didn't receive financial support – loans or loan guarantees – in India billions of dollars were allocated to the industry during the crisis and in Belgium hundreds of millions of euros in the form of loans were backed by the government. Antwerp, which like Mumbai and Tel Aviv also hosts a mature diamond center, has other battles, though.

Diamonds are a major contributor to Belgium's economy. Despite that, in the past couple of years a series of outrages diamond confiscations led many to move their operations out of the country, or making sure the goods they are holding will be on memo, and not owned by them. This way, if they are confiscated, they will hopefully be returned quickly. The government failed to step in and stop the ridicules antics of a few law enforcement officials, and the country as a whole is paying a price for it.

Conversely, in the past couple of years we heard and saw the Mines Minister of Zimbabwe fighting for his country's diamond sector. In Botswana, Canada, South Africa and other countries with a relatively young or budding industry, we see top officials backing, supporting, legislating and lobbying for the growth of their country's diamond sector.

It's no coincidence, and some may say normal – a law of nature. Parents hold their young children's hand and try to give them everything they can to help them become successful and independent. As they grow, we hold their hands a lot less, slowly letting go. A friend once told me that being a parent is a long goodbye, as your child depends on you less and less.

Yes, there is a lot of truth to it, yet, parents, especially attentive and supportive parents, make a point of being available for their children and helping them at a time of need even after they become grownup, even when they are mature adults.

No matter how confident a diamond center may feel, it always wants to further develop. Resting on laurels is no way to ensure longevity or continued growth. Mostly centers can take care of themselves, but sometimes needed support will make the difference. Now that the worst of the financial crisis is behind us, a little support from government will make a big difference for these three countries. This is no time to abandon the most important diamond centers.