Page 29 - Bullion World Volume 04 issue 12 December 2024
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Bullion World | Volume 4 | Issue 12 | December 2024
B ullion W orld | V olume 4 | I ssue 12 | D ec ember 2024
Exclusion • Concern: Including Chapter 71 (covering gold, silver, and platinum) in trade
of Chapter agreements creates tariff imbalances and disadvantages dore bars.
71 in Trade • Proposal: Exclude Chapter 71 from agreements to maintain equitable tariffs.
Agreements
• Current Limitation: Export of gold bullion is restricted to 22K under existing
Export of 24K regulations.
Gold Bullion • Proposal: Permit the export of 24K bullion and minted products, boosting
domestic production and value addition under the “Make in India” initiative
• Challenges: Small exporters face delays and inconsistencies in receiving duty
100% Duty drawbacks, discouraging participation.
Drawback • Proposal: Streamline the duty drawback process, ensuring timely refunds (within
System seven days) based on the tariff rate on the day of export. This will promote exports
by small jewellers.
• Current Issue: Inconsistent customs duties across gold products discourage
Uniformity in domestic refining.
Customs Duty • Proposal: Implement a proportional adjustment of duties for imported bars, dore
Structure
bars, and finished products to incentivize local value addition.
• Reduction in Minimum Import Quantity: Lower the minimum import requirement
Amendments to for dore bars from 5 kg to 2 kg.
Customs Law
• Tariff-Based Duty: Align customs duties on dore bars with the tariff rate for bullion.
A review of customs duties over the past decade highlights the declining margins for
refiners due to policy changes. The differential between refined bullion and dore has
Industry Data narrowed significantly, from 2% (2012-2015) to -0.35% (2024), creating unsustainable
and Insights
conditions for domestic refiners. Operational expenses have risen, further exacerbating
the challenges.
Conclusion
AGRM acknowledges recent government efforts, such as the 9% reduction in gold import duty in 2024, which
have curbed smuggling and stabilized market prices. However, the association urges immediate action on the
outlined proposals to restore the sector's viability and enable its significant contribution to the national economy and
employment.
Key Recommendations:
• Increase the duty differential for gold Dore to 1.65%.
• Permit local bullion sourcing and collection under the Gold Monetization Scheme.
• Enable the export of 24K bullion to enhance value addition.
• Ensure uniformity in customs duty across gold products.
• Expedite the duty drawback process to support small exporters.
By addressing these challenges, AGRM aims to strengthen the domestic refining sector, promote sustainability,
and align with the “Make in India” vision.
Submitted by: Harshad Ajmera, Secretary, AGRM
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