Harare's government is mulling a new Diamond Act that would make State participation in all alluvial diamond mining activities mandatory, All Africa reported.

The proposal, which aims to tighten the screws on mining activities, especially in the diamond rich fields of Marange, came in wake of recent revelations, which suggest that Zimbabwe may have lost more than $30 million worth of diamonds mined in the area without the authorities' knowledge.

"There is broad consensus in the government that there should be a new Diamond Act that requires that all alluvial diamond mining be conducted by and through the State," Harare's Finance Minister Tendai Biti said.

"This will be in recognition that it will not be business as usual at Marange and that the State will not allow the issuance of multiple mining licenses that facilitate proliferation of small diamond mining operations," he added.

The move, he said, aims to ensure that revenue from Marange is accounted for accurately, which would enhance transparency – the quality and value of the gems from the area is currently unclear.

Zimbabwe claims it is presently sitting on 4.7 million carats of diamonds valued at an estimated $1.7 billion and awaits permission from the Kimberly Certification Process Scheme to sell the stockpile for the much need income.

The diamond Act would also deal with the issue of compensation and relocation of displaced families in Marange and provision of critical infrastructure. Furthermore, the Act aims to set up a "diamond fund," which Biti said would be part of the overall National Mining Fund.