Gokhran Nearly Quadruples Diamond Purchasing Budget

Gokhran, Russia's State Precious Metals and Gemstones Repository has earmarked 14.46 billion rubles ($467.23 million) to buy diamonds from producers in 2009, according to Interfax. The repository has been buying diamonds from state owned miner Alrosa, which has seen its sales drop sharply since November against the backdrop of the economic crisis.

The procurement budget, approved by the government on June 1, includes the 3.69 billion rubles ($119.23 million) in annual scheduled funding to buy rough and cut diamonds in the period 2008-2010.The additional 10.77 billion rubles quadruples the Gokhran’s diamond buying budget.

According to a source that spoke with Interfax, it is not clear how the funds will be distributed among the companies. The source said the Russian Finance Ministry intends to decide on this in the next couple of weeks.

Last year, the Gokhran expanded its diamond purchasing budget by an additional $170 million, which more than doubled its purchasing budget that stood on $130 million.

Alrosa is stepping up its efforts to find buyers for its goods, and has approached manufacturers in the diamond centers in order to resume sales.