"The risk taken was worth it," says Choron CEO

How was Choron Diamond affected by the global crisis? What is your turnover today and what is your forecast for the sales this year?

Rajesh Gandhi: Our jewellery is still a part of a dream world. It`s a world of continuous innovation and expansion where the preservation of Choron Diamond`s image is important. Since October 2008 – a year before the full effects of the financial crisis were felt – we have worked with tremendous caution and kept a close eye on the market through our strong 350 retailers who sell our products. We were re-examining our books based on which we reorganized our product and strategy. All these elements were factored into our decision to freeze our inventory. So we brought production to a minimum in 2009. We foresee an increase of 25% of our sales than in the year 2009. This policy has proven successful especially when the going gets tough.

In 2007 you planned to invest 65 mil USD into creating a network of retail shops. Has the crisis change your plan?

Rajesh Gandhi: After an in-depth and extensive analysis of the property market in Moscow and Saint Petersburg, we came to a conclusion that the property market at that time was overheated. However, we have not given up this idea and are looking for right time to plunge back.

What is the structure of Russian subsidiary of Choron Diamond?

Rajesh Gandhi: At Choron Diamond Russia we are processing the full life cycle of a diamond. Right from procurement of rough diamonds from the miners to selling of diamond studded jewellery to the consumers. We are polishing rough diamonds at our hi-tech manufacturing unit in Yakutsk. After which the polished diamonds are sorted by qualified gemmologists. Based on the assortments and the demand for the internal markets, the polished diamonds are either exported or offered to jewellery factories and wholesalers across Russian Federation. Similarly, the diamond studded jewellery is sold through our retailers. The next logical step is to enter retailing and start our own retail network.

You have factories in India and in Russia. How do you use this advantage?

Rajesh Gandhi: It helps to get the most from the experience that specialists from both countries have. In fact the company does not only own factories in Yakutsk and Mumbai, we also work intensively with our partners in China, Thailand, Italy and other countries. We want to keep up with all the changes in the moods of customers to have the possibility to offer to them products that will be made in accordance to the latest technologies and fashion tendencies. Our products are result of work done by specialists from all over the world. That is one of the keys to our success.

There are rumours Alrosa is planning to develop a retail business, and Choron Diamond is named as one of the possible candidates to manufacture production for Alrosa retail shops. Is it true?

Rajesh Gandhi: We are not aware of any such rumours.

Your family has been involved in cutting and polishing diamonds for more than 65 years. When you started your business in Russia, how did you relatives react?

Rajesh Gandhi: Initially, my relatives did not like the idea of working in Russia and opposed it. But after few years of successful working they eventually supported me and started joining the business. As of today my elder son, my wife and 3 of my cousin brothers are already an integral part of the group. Soon my younger son will enter the business and I can’t wait to see that day.
Of course, coming to Russia was a risk but now we can proudly say that it was worth being taken. The proof of it is in the fact that the company has been working in the market for 11 years as well as an untarnished reputation in all aspects of business. This has been acknowledged on the top level: in 2008 and 2009 Choron Diamond was named the Best exporter in the industry and in 2010 – the Best Taxpayer as well as, according to Indian business Alliance, the best Indian company in Russia.

What were your first impressions of Russia?

Rajesh Gandhi: My first memories of Russia are really very remarkable. Surprising it may sound but during my first visit I faced in fact the common between two nations. I remember when I came to Yakutsk, it was -40 outside and in the centre of the city opposite to the cinema there was a billboard with an advertising of the Shri 420 film starring Raj Kapoor. I couldn’t believe my eyes at first. Probably, this billboard was a sign from above, a sign of that I will succeed.

What can you say about the ways of economic development in Russia and India?

Rajesh Gandhi: Russia and India are similar in many ways. Each country has its strong points: for India it is cheap labour, in Russia – vast resources. Combining them together will be a perfect scenario.
Russia and India has a long history of close and warm relationship. I evaluate it as successful and I do not see any reason why my opinion should change. The country leaders are constantly meeting each other to provide more support to the business connections that are growing. I see great opportunities in cooperation in tea, pharmaceuticals, IT, diamond and jewellery industries.

How do you evaluate the economic situation in Russia today? Is it ready to attract foreign investments?

Rajesh Gandhi: As it happens with all the companies that are opening themselves to the world, it takes time for Russia as well to reveal its full business potential. It was tough for me a decade ago to start here but with every year it is becoming better and better. Those who want to launch it now must realise that once they have the strong will and they are present in the country they have all the chances to succeed. The negligent attitude will not lead you anywhere.

You are personally following your business in Russia. Don’t you trust mercenary managers?

Rajesh Gandhi: I am personally following my business everywhere, not only in Russia. And it is not the question of trust. It is the personal touch that matters. Like you always go to the same doctor or the same lawyer, our industry is much personalised. Apart from that my company is my child and I am responsible for it. I must know it top to bottom to bring along its further development and prosperity. This is why I follow everything that happens to be in control.

If to compare conditions of doing business in Russia and India – are there any differences?

Rajesh Gandhi: Speaking about Russia and India, they are almost identical in how business goes in both countries. I would not plunge into details, just come with one example of personal touch that I have just spoken about. Good relationship with your business partner is what matters the most.
There were and there are difficulties and their main reason is that I am a foreigner in Russia. My mentality was formed in one way, here in Russia there are different realities that I have never faced. It is something you always have to overcome when you start your business in a foreign country. The moment I learned the language things became easier. However, all this became insignificant because people in Russia welcomed me heartedly and continue to make me feel at home here.

Could you describe your everyday life in Russia?

Rajesh Gandhi: I am a dedicated businessman and I spend most of my time at my desk wherever I am. However, I have seen quite a lot of Moscow and the country in general: my friends and business partners have contributed much to it and I am really thankful for it. In Russia all the people that I have met have been most welcoming and supportive in my desire to work here and my interest in their culture.
My family, meanwhile, is scattered all over the globe. Now It is because of the business matters but when my children were little I could not bring my family to Yakutia where I only started my business. My sons were receiving their education in English, which is something they could not get in Yakutia that time. Furthermore, our family is vegetarian, we do not eat meat, fish, eggs. This was a problem indeed. Now it is much better in Moscow, with different vegetarian restaurants available.
The other problem here is climate. It was not so easy to get accustomed to snow and wearing warm clothes for around 8 months a year. But it never was an obstacle for anyone determined to do what he wants to. After all, that’s the way I am.

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