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“When margins lay principally in diamonds of a carat and up, roughly 2 percent of the world’s output,” says analyst Chaim Even-Zohar, “India discovered its genius for making business out of smaller goods. As access to larger goods came through additional sights and other sources, Indian cutters were amazingly quick to find margins there. What they taught the world in doing so was, first, the importance of flexibility, and second, the need to invest in the immediate future.”

Rosy Blue president Dilip Mehta prioritizes the latter: “India is a place where we are taught to look at the top line to grow business, rather the bottom line. The moment you don’t invest in your business, you’re out.” A sign on the wall of the office of Ajay Ramchandani, executive of task fulfillment for Rosy Blue’s wholly owned Inter Gold jewelry wing, tells it all: “If you are not riding the wave of change, you will find yourself beneath it.”

Mumbai is now hanging ten right through the pipeline of the world’s diamond wave, a position made possible by a decade of hard work and even harder-earned growth in investment. 2005 saw what A.K. Purwar, chairman of the State Bank of India, the largest of the country’s 55 diamond banks, tallied at “Sixty percent year-to-year growth, all of it geared toward adding value, with a very reasonable two-year growth forecast of $15-$20 billion.” India is well on its way to meeting that forecast.

On the supply side of progress toward becoming the world’s treasure house, India has become home to 32 of the DTC’s 84 sightholders, and, as managing director Gareth Penny adds, “far more than the respective number of attractive applicants.” It also leads the customer ranks of most other miners as well, and in 10 years, has grown from being the destination of the world’s piqué to the country where miners from Russia to Canada to even Africa, as Ingele Ifoto, the DRC’s minister of mines says, “learned to break away from their dependence on historic connections in Europe as traditional markets for sale, polishing, and setting. What we’ve all found here was a tremendous elasticity among Indian businessmen for making the relationship work.”

RIDING THE WAVE

That elasticity was clear on the demand side as well. By 2006, 35 percent of all Indian goods—diamonds but more and more so, diamond jewelry—shipped directly to the U.S. The number grew to 50 percent when goods came to the U.S. via the many Hong Kong offices operated by Indian diamantaires. Ben Bridge began the trend, buying directly in 1996, Sterling began visits in 2001, Wal-Mart in 2002, and Zales in 2003, and by mid-decade most of the majors began their months literally standing on Indian cutting and setting floors.

“Direct dealings with retailers is a huge element of Indian growth,” says Kullip Singh Lallie of Suashish. “So much of it came from learning how to listen to the market, whether for branding, ideal cuts, jewelry. Formerly, it had to be flawless to command the premium, now you can listen to what the market is telling you, and it informs everything from how you source to the shapes you cut to styles and prices of jewelry.”

What each visitor has seen is the remarkable speed with which cutters and setters achieved respective masteries, and how the growth of automated processes enabled prices and margins that were unattainable anywhere else. “We started with lasers in 1987,” says Lallie, “simply to make the V groove for cleaving. But then we started to experiment, incorporating software from Germany, Switzerland, and Belgium, and those lessons have enabled us to go from losing 2 percent to 0.2 in bruiting and blocking, and have one man running six machines at a single time, rather than two people running one.”