Surat: Facing global slowdown, the country’s gem and jewellery trade is expecting various reliefs from the government in the next Union budget.
The Gem & Jewellery Export Promotion Council (GJEPC) has proposed several recommendations to the government in this regard. According to GJEPC, the industry sustains around 4.3 million jobs and contributes 10 percent of the country’s exports.
It heavily relies on imports of raw materials of gold, diamonds, silver and coloured gemstones.
“GJ exports have been facing a challenging time on account of economic downturn in key export markets. The key inputs are geo-political concerns, supply and demand side constraints in global diamond industry, among others. GJEPC’s pre-budget proposals will facilitate easy access to raw materials especially for MSMEs,” said Vipul Shah, chairman, GJEPC.
Among major expectations, GJEPC appealed for safe harbour rule for sale of rough diamonds in Special Notified Zones (SNZs), introduction of Diamond Imprest License and reduction in import duty on cut & polished diamonds from 5 per cent to 2.5 per cent.
The demands also include a reduction in import duty on gold/silver/platinum bars to 4% from the existing 15 per cent in gold bars. GJEPC has sought a reduction in import duty on silver bars from 10 per cent to 4 per cent; and reduction in import duty on platinum bars from 12.5 per cent to 4 per cent.
The trade also expects the introduction of a mechanism like “Rates & Taxes Refund” through EDI system similar to GST refund.
“Introduction of Diamond Imprest License or the reduction of import duty on cut & polished diamond from 5% to 2.5% will help to cope up with the impact of beneficiation policies undertaken in a number of natural diamond mining countries,” said Shah, adding that it will give India a level playing field with competing countries like China, Vietnam and Sri Lanka.
We are hopeful that with the additional support of the government in terms of reduction in import duty of precious metals and MOOWAR scheme for gem and jewellery industry, the exports of gold jewellery will increase substantially in these challenging times, Shah added.
“As most of the rough producing countries have either banned export of rough like Colombia, Sri Lanka, Tanzania and Myanmar, some are discouraging exports of rough by imposing certain restrictive conditions or higher export duties like Afghanistan and Ethiopia,” stated GJEPC in a statement.
“This has left no option for the Indian gems & jewellery industry but to import finished gemstones for manufacturing of jewellery and export thereof. Also, coloured gemstones are intermediate products for use in manufacture of jewellery to fulfil export orders,” it added.
