(IDEX Online) - cThe paper will aim to address critical banking issues such as assessment of credit limit, collateral security, related party transactions, inventory valuation, and subsidiary cguidelines, and is aimed at mitigating the concerns of the key stakeholders of the industry that has been hit by the recent Nirav Modi fraud case.
The white paper, entitled 'Diamond Financing 2018 New Challenges', compiled by the GJEPC in consultation with the gems and jewelry industry and top banking lenders offers solutions "to mitigate the fallout post-scam, to ensure we embark as an industry on the journey towards self regulation and ensure good promoters [companies] continue to get credit."
In light of the present scenario, the white paper focuses on the key challenges faced by the bankers in financing the gems and jewellery industry and how to address them. It puts across GJEPC and trade members' views on critical issues like reduction of credit limit, collateral security, related party transactions and valuation of stock and that the government, the Reserve Bank of India (RBI), the Export Credit Guarantee Corporation of India (ECGC) and other concerned authorities be informed of it, the body said.
Pramod Agrawal, Chairman, GJEPC said, "The banking seminar gives us a joint forum to regain trust and ensure all bankers have a profitable experience in lending o the trade. Under the aegis of the Commerce and Industry Minister, we expect a large participation from both the banking fraternity and gem and jewelry industry. The White Paper will be historic for the industry and will play a critical role in creating an enabling environment for this labor-intensive sector going forward."
The gems and Jewellery industry in its journey towards self-regulation has an underlying responsibility to earn back the trust of the banking industry.
"In that journey a joint seminar with the government, banking fraternity and the industry is the ideal platform to help mitigate the risks of our lenders," said GJEPC Vice Chairman, Colin Shah. "The GJEPC has worked on a white paper that would address and find solutions to specific issues like assessing working capital limits, collateral security, related party transactions and the valuation of stock.