Jewellers are facing challenges in availing funds from banks following the PNB fraud case in which diamond traders Nirav Modi and his uncle Mehul Choksi are allegedly involved, a top industry official said.
Nirav Modi and Choksi are being investigated by the Enforcement Directorate (ED) for allegedly cheating Punjab National Bank (PNB), the country's second largest lender, to the tune of more than USD 2 billion or over Rs 13,000 crore.
"Major challenge today we face is funding for the industry. Our immediate requirement is around Rs 15,000 crore. Earlier some jewellery retailer went bankrupt. After Nirav Modi issue, the issue has gone up pan-India," said Gem and Jewellery Council vice-chairman. They encourage us to close the existing loans and not keen on renewing," he told.
Responding to a query on what was the industry's request to the financial institutions, he said, "we requested them to ease the norms. Today they have completely freezed it. If I want to open three-four branches, I need bank support. Banks are not coming forward." To open one branch, financial assistance from banks would be for 75 per cent and the remaining 25 per cent would be.
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