Diamond Industry Woes Impact Surat's Real Estate Market
Surat: With the diamond industry facing significant challenges, the real estate sector in Diamond City is experiencing rough weather. There has been a noticeable decrease in approvals sought from the civic body for new construction projects.
Industry insiders attribute the major factor affecting real estate to the slowdown in the diamond industry. From 724 project development permissions granted by the Surat Municipal Corporation (SMC) in 2022-23, the number dropped to 553 in 2024-25. Meanwhile, earnings from paid FSI grew from Rs 629 crore in 2022-23 to Rs 1,109 crore in 2024-25. Apartment buildings account for most new projects.
Gross exports of cut and polished diamonds (CPD) were worth $13.29 billion in 2024-25, marking a 16.75% drop from $15.96 billion in 2023-24. Another key indicator of the city's economic health is the import of rough diamonds from mining and trading centers. Gross imports of rough diamonds were at $10.8 billion in 2024-25, a decline of 24.27% from $14.26 billion the previous year. In volume terms, gross imports of rough diamonds stood at 1,044.34 lakh carats in the 2024-25 financial year, a decline of 16.2% from 1,246.17 lakh carats the previous year.
Gross exports of polished lab-grown diamonds in the 2024-2025 financial year were at $1.26 billion, a decline of 9.64% from $1.4 billion the previous year. Industry experts noted that the value of lab-grown diamonds is less than 10% of natural diamonds. "There is a slowdown due to several factors, and the diamond industry is passing through a rough patch. The drop in business is directly affecting the real estate sector in the city," said Jasmat Vidiya, chairman of CREDAI, Gujarat.
Key real estate players have observed a significant drop in inquiries. Meanwhile, projects that are in the pipeline are progressing. "While business is average in textiles and there has been no extraordinary growth, it is supporting the city's real estate. However, the diamond industry plays a major role in the growth of the real estate sector," said Vidiya.
Developers note that there is demand in certain segments of apartments, but the overall market is slow. "There are challenges due to the economic conditions, but there is demand in a few segments. Quick approvals relating to project development from the civic body can boost the real estate sector," said Sanjay Mangukiya, chairman of CREDAI, Surat.
