Vasant Mehta, chairman of India’s Gem and Jewellery Export Promotion Council, on Wednesday denied reports that the Indian industry was pulling its business out of China, following the arrest of 21 Indian diamond traders suspected of diamond smuggling.

In an e-mail to the industry, Mehta stated that the news reports were "totally incorrect and misguiding." He also stated that the GJEPC respected the law of all countries, including China, and "does not support any illegal activities."

News reports had claimed that Indian diamond merchants were determined not to do any business with China until the diamond traders were released. The traders were detained Janaury 8th and charged with illegally transporting  gems from Hong Kong to the south China boomtown of Shenzhen. The arrests also came in the wake of three Chinese engineers detained by India in Chhattisgarh in connection with a chimney crash at the BALCO plant in Korba, where around 41 were workers were killed in September, according to news sources.

JCK