Saturday, September 26, 2020

Ansari’s visit a damp squib?

“No, I will not be writing anything about it ÔÇô there was really no story,” grumped Godfrey Ganetsang, the Telegraph News Editor, who was assigned to cover the state visit of India’s vice President, Hamid Ansari, to Botswana over the weekend.

Ganetsang sounded like a sulking child, but who could blame him. None of the advertised fireworks ignited quite as promised. The visit did not live up to its advance billing. The main attraction – the signing of an agreement that would enable India to buy rough diamonds directly from Botswana did not materialize. The anticipated heated press conference turned out to be a damp squib. The previewed bitter love triangle between Botswana, India and De Beers fizzled out in the pad. For journalists bracing for drama, the sense of occasion was nonexistent.

Expectations of ground breaking agreements were raised by copious media previews based on leaks that the visit would pave way for India to buy rough diamonds directly from Botswana.

Ansari made no secret that India was on a diamond search in Botswana, and was hoping to increase direct access of Indian companies to rough diamonds, rather than through middlemen.

“Botswana is the world’s first or second largest diamond producer. This is of direct interest to us, as we have a large and prosperous diamond cutting industry in Gujarat,” Ansari had told reporters at the beginning of his journey in New Delhi last week Tuesday.
The state visit had all the makings of a bitter love triangle between Botswana, India and De Beers. As the Sunday Standard put it: “No visit by an international politician has ever concentrated so many questions about the future if Botswana’s relationship with De Beers as that of Ansari.”

Indications were that Botswana’s relationship with De Beers had hit a difficult patch. The relationship, which spans more than 40 years, was expected to finally unravel as India started wooing Botswana. The situation was further complicated by a speech last November, by former Coordinator of the Botswana Diamond Hub project, Dr Akolang Tombale while addressing the World Federation of Diamond Bourses (WFDB) meeting in Antwerp.

Tombale pulled no punches as he charged that, “we cannot entrust our national survival on people who, when it makes business sense, can switch their interest any time and do something else that suits them at the time,” he said. “It is simply too important for us to abdicate our responsibility or leave anything to chance.”

He further stated that, “We don’t want to be left at the end of the day without any diamonds when mining ends, so we are trying to build an industry that goes beyond producing. That’s an objective far bigger than the relationship with De Beers. It’s a matter of our survival.”

Tombale stressed that the time had come for Botswana to take the next step in building the diamond hub by encouraging third-party trading within the country.
If Tombale was speaking for Botswana, then India and Botswana appeared to be marching to the beat of the same drummer. An anonymous Indian source accompanying Ansari was quoted saying, “even the government of Botswana wants to diversify the procurers for its diamonds. Things have changed post the worldwide economic crisis as in the global recession the monopoly procurer has refused to source diamonds.”

However, a few weeks after making his take-no-prisoners speech, Tombale announced that he was retiring as coordinator of the diamond hub, under curious circumstances.

While most headline writers were convinced that the proposed diamond deal between India and Botswana was a shoo in, De Beers, on the other hand, appeared to be on safe ground.
The diamond mining giant issued a press statement on Friday saying that, ”as shareholders of Debswana, De Beers and the Government of Botswana have a long term commitment to sell all the company’s production to DTC Botswana.┬áThe shareholders also established DTC Botswana to serve as a vehicle for the promotion of Botswana as a global diamond centre and to promote beneficiation of Botswana diamonds. The arrangements for the sale of the Debswana production are integral to the very purpose for which the DTC Botswana joint venture was formed.

The CEO of De Beers Botswana, Sheila Khama, said, “We can confirm that these arrangements remain in force and are binding to the parties. Further that Botswana’s Ministry of Minerals, Energy and Water Resources officials have advised that there are no agreements being contemplated┬áwith the Indian authorities for the direct sale of rough diamonds,┬ánor are there any formal discussions planned┬áon this topic┬áduring the forthcoming visit by the Indian Government delegation.”

The De Beers press statement stated that, shareholders of Debswana and DTC Botswana remain committed to mine, sort, value and to sell all Debswana’s production in a way that drives value for themselves and for the country.
As it turned out, the much anticipated diamond sale agreement between Botswana and India never materialised. A press conference addressed by Merafhe and his Indian counterparts was choreographed to close out any questions on the
anticipated diamond agreement.

Journalists attending the press conference could not field any questions to the two vice presidents, as all queries were directed to the Minister of Agriculture and the Minister of Education. Botswana and India signed the education and agriculture agreements. Indications are that Botswana may have gone back on the initial position espoused by Tombale, for a parallel marketing route outside the De Beers DTC.

Some industry watchers, however, argue that the devil is in the details. Permanent Secretary in the Ministry of Minerals, Energy and Water Resources, Gabaake Gabaake, confirmed to the local media that the contract with DTC was still in force although┬áit is up for re negotiation in a few months. He was quoted as saying: “We have a standing agreement with DTC which ends in December this year and we are supposed to start renegotiating that contract in a few months time.”

On a second look, this does not seem to contradict Dr Tombale’s position. Tombale had said that he hoped the new diamond-trading platform would be in place by the end of 2010, allowing others to trade in the country, while the independent marketing of Botswana diamonds “will come a bit later, probably in 2011.”

Some industry watchers have simply joined the dots, and an entirely different picture emerged: That the deal between Botswana and India may have been discussed behind closed doors and will probably be signed at the end of the Botswana agreement with De Beers in 2011.

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