Some of the top Indian exporters of cut and polished diamonds will benefit from the deal that is expected to create an alternative source of roughs for India, which is the world's largest hub for this industry, accounting for nearly 80 percent of volume, officials said.

Russia is the top producer of roughs and Alrosa controls around 27 percent of global trade. The agreements were signed coinciding with Russian President Vladimir Putin's visit here for the 15th India-Russia Annual Summit, during which he and Prime Minister Narendra Modi also attended the World Diamond Conference here.

"We are looking at steady supply of rough diamonds to India. Alrosa has decided to have 12 direct sales agreement with India companies," said Siddharth, director general of supplies and disposals, the nodal government agency for procurements.

"This deal is worth $700 million per year for three years," said Siddharth, who uses one name.

Modi, in his address at the conference, said: "I want major diamond mining companies to sell directly to the Indian diamond industry. it will be good for them and for India."

The conference was organised by Gems and Jewellery Export Promotion Council; the ministry of commerce and industry; and the World Diamond Mark.

Normally, the way deals in the global rough diamonds industry work is once a definite contract is signed, the buyers have to lift the specified value of consignment each year, irrespective of the fluctuations in prices, demand and supply.

India imported 163.11 million carats of rough diamonds worth $16.34 billion in 2013 and exported 36.46 million carats of polished diamonds valued at $20.23 billion. The bulk of the supplies came from the Antwerp-based De Beers, which is said to control some 40 percent of global roughs trade.

The companies that will benefit from the latest deal are Rosy Blue, Diamond India, Hari Krishna Exports, Dimexon Diamonds, Jasani Group, Asian Star, Kiran Gems, KGK Diamonds, Shri Ramkrishna Exports, Venus Jewel, Karp Group, and Sheetal Group.

Andrey Polyakov, vice president of Alrosa, said: "Diamond business is sensitive. The main thing is to raise consumption in India and China."

It is estimated that by the end of this decade India and China together will consume 40 percent of global diamond market and will become at par with the US, which is now leading the market.

The total amount of gems and jewellery exported from India in 2013-14 was worth $39 billion, of which $24 billion were diamonds.

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