Saturation in embroidery, rising demand in international and domestic diamond market responsible for reversal

The booming embroidery industry in Surat is now struggling to cope with a plummeting demand, coupled with a surplus of stock.

Several diamond businessmen had jumped into the embroidery business when the diamond industry was faring badly because of the global slump. They had even installed embroidery machines at their premises, but are now returning to the diamond trade.

Initially, the diamond industry migrants had fared well and workers were doing two shifts. But after Diwali, the overproduction began taking its toll, according to Bharat Patel, secretary of the Surat Embroidery Association.

Earlier, the factory owners were getting payment after a month for their work, but now the payment period extends up to three months. Many unit owners had stocked their finished goods and are now running their units on single shifts due to the decreased demand.

Industry sources said the actual impact will become clear by next month.

Paresh Sawani a diamond factory owner, who had shifted to the embroidery sector, said: “We made a big investment in the embroidery units by installing heavy and costly imported machines. It is true that the demand is insufficient at present, and we are returning to our own business. At present, I have handed over the embroidery factory to my relative and am continuing with my old diamond business.”

Dinesh Nawadia, vice president of Surat Diamond Association said: “We are seeing many embroidery manufacturers returning to their original business. Some have even shut down their embroidery factories. The demand for diamond in the international and domestic markets has gone high and this is the reason which had attracted them to return.”

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