Panna, Apr 12: Closure of National Mineral Development Corporation's diamond mines has unfolded manifold problems in Madhya Pradesh's Panna district, where gem and industrial variety diamonds were mined for centuries.

Following complaints about environmental disaster caused to the Panna National Park, NMDC-run mines were closed in 2005 causing a deadly blow to the diamond trade in this backward district.

While high-tech machines used by NMDC came to a halt after the Forest Conservation Act was enforced in the diamond-bearing forest areas, several hundred workers were also rendered jobless.

Diamond Officer J K Solanki said earlier about 75,000 carat diamonds were used to be mined from the NMDC mines every year earning about Rs 4 crores to the government.

Now a days, only shallow mines were in operation yielding a maximum of 500 carat diamonds in a year. According to Mr Solanki, 1104 lease were granted in 2007-08 for shallow mines yielding 563.61 carat diamond. Revenue from shallow mines was not sufficient to run the diamond office itself, he added.