Gems and Jewellery Industry Urges Duty Cuts to Boost Exports
Tue June 25 2024
The Gems and Jewellery Export Promotion Council has requested the Indian government to reduce import duties on gold, silver, and platinum bars to 4 percent in the upcoming budget. The council argues that these measures will enhance competitiveness, boost exports, and generate employment amidst current geopolitical and economic challenges.
During a pre-budget meeting with Finance Minister Nirmala Sitharaman, the council emphasized the significant role of the gems and jewellery industry, which accounts for around 10 percent of India's total merchandise exports.
However, the sector is grappling with multiple challenges such as geopolitical uncertainties, the emergence of the beneficiation scheme, and issues in sourcing rough diamonds. In this context, the GJEPC urged the government to implement measures that would help revive exports.
The council also proposed the sale of rough diamonds in Special Notified Zones (SNZs) and requested duty drawbacks on platinum jewellery exports to leverage the India-UAE comprehensive economic cooperation agreement.
Such initiatives, the GJEPC stated, are essential to granting a competitive edge to Indian exporters while simultaneously boosting employment in the sector.
To further expand the scope of SNZs, the council suggested allowing globally recognized diamond broking and trading houses within these zones.
Reducing import duty on precious metals is critical, according to the council. For instance, cutting the import duty on gold bars from 15 percent to 4 percent would free up Rs 982.16 crore of blocked duties, providing much-needed working capital for the industry.
The council believes that unlocking this working capital could help realize the untapped export potential for gold jewellery, estimated to reach at least USD 2 billion of a total USD 11 billion over the next two years.
The GJEPC also recommended reducing import duties on silver bars from 10 percent to 4 percent and on platinum bars from 12.5 percent to 4 percent.
Source: https://www.devdiscourse.com