Mumbai, May 24 : India, the world's largest maker of cut and polished diamonds, will set up an international diamond trading hub covering all aspects of the business, said Commerce and Industry Minister Kamal Nath Tuesday.

Addressing the inaugural session of a two-day diamond industry conference here, the minister said India had all the ingredients to consolidate its position in the global gems and jewellery industry.

"We hope to establish a diamond trading centre in India on the lines of ones that are there in Belgium and Israel," Kamal Nath told overseas and Indian representatives of the gems and jewellery industry.

"We will make available all facilities in the trading hub covering all aspects of the diamond industry. The trading centre will be a joint initiative of both the government as well as the industry," he added.

On the timeframe for setting up the diamond-trading centre, Kamal Nath said: "We will take definite action on this front this year itself. There is no reason why we can't become the treasure house of the world."

The minister said there was a need for Indian gems and jewellery companies to invest overseas and that the government would encourage foreign investments as well as the setting up of joint ventures by domestic diamond traders.

"We are quite open to the idea of entering into economic cooperation with the African countries," he said, adding the cut and polished diamonds have become an important component in India's exports of gems and jewellery.

"The potential for value addition in the diamond industry is enormous. The companies must identify innovative ways that will create value for all the stakeholders," said Kamal Nath.

Bakul Mehta, chairman of the Gems and Jewellery Export Promotion Council, said India's gems and jewellery exports have increased from $28 million in 1966-67 to a staggering $15 billion in the fiscal year ended March 31, 2005.

"This sector is a valuable foreign exchange earner, contributing about 18 percent to the country's total exports," he said.

Mehta proposed the setting up of an independent company, in association with the Indian government, to provide "direct and easy access" to the mining countries for supplying rough diamonds to local exporters.

"We are also aware of the need to develop useful and mutually beneficial partnerships with other countries and companies in the gems and jewellery industry across the world," he added.
(IANS)