A YEAR ago, India’s diamond capital hit the headlines when one of the largest polishing companies in the western city of Surat treated hundreds of employees to bonuses in the form of Fiat cars, apartments and jewelry.

    This year, there’s no sign of a repeat bonanza in a city that by some estimates polishes about 80 percent of the world’s diamonds.

    More than 5,000 Surat polishers have lost their jobs since June and thousands more could be left without work, as Chinese consumers pull back from luxury purchases, leaving jewellers with stocks of unsold jewelry and gems. Polishers say Chinese jewelers have defaulted on deals worth millions of dollars.

    Nearly half a dozen large diamond companies in the city have closed down: a significant hit for an industry that employs nearly a million people in India, two-thirds of them in Surat.

    Jobs are a critical issue for India’s government, struggling to revive economic growth to a rate that will create employment for millions joining the workforce every year.

    Sunilkumar Rajput spent 25 years cutting gems in this coastal city, where streets are lined with workshops of all sizes, bustling with craftsmen huddled under desk lamps, preparing to carve rough diamonds into multi-faceted gems. He lost his job in June.

    “I am ready to work even at half the salary I was getting in my previous job, but no one will listen,” says Rajput, 45, speaking in a quiet side street of Surat. He has sent his children back to his home state of Uttar Pradesh, in India’s north, to save money.

    Distress in Surat’s warren of polishing houses comes at a time of unrest across the state of Gujarat — Prime Minister Narendra Modi’s home base — where hundreds of thousands of members of the Patidar, or Patel, community have held protests to demand changes to India’s affirmative action policies, which they say hurt them.

    (SD-Agencies)