Budget 2024: Indian Jewellery Industry Calls for Import Duty Reduction on Precious Metals
GJEPC urged the government to introduce the Diamond Imprest Licence again in the 2024 Budget to help the sector thrive at international level.
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Ahead of the 2024 Union Budget, stakeholders in the Indian jewellery industry are demanding the government to reduce import duty on gold to 10 percent from the present 15 percent.
Besides, they also demanded a concession of 0.5 percent on imports of gold through the India International Bullion Exchange (IIBX) and exemption of tax on interest earned on Sovereign Gold Bonds.
Similarly, the Gem and Jewellery Export Promotion Council (GJEPC) pleaded with Narendra Modi’s government to reduce import duty on polished diamonds to 2.5 percent from the current 5 percent and introduce Diamond Imprest Licence again to help the sector thrive at global level.
According to the apex body for the gems and jewellery industry of India, higher import duty is leading to reduced exports and fewer employment opportunities in the sector.
Imposing higher import duty on gemstones is making life difficult for industry to survive at the global level. Moreover, India is also losing competitive edge to other rival countries like China and Thailand.
Implementing these changes will level the playing field for Indian MSME diamond exporters, prevent investment shifts, and create more jobs in the diamond sorting and processing industry.
The stakeholders requested that rough diamonds be sold in Special Notified Zones (SNZs) under the Safe Harbour Rule, expand eligible entities in these zones, and allow SNZs to function as Free Trade Warehousing Zones (FTWZs) when not used by mining countries.
Besides, GJEPC also proposed the establishment of SNZ for rough gemstones in Jaipur.
The GJEPC is also demanding the government allow global diamond trading houses in SNZs to help smaller miners, who comprise up to 35% of the total global mining industry. Additionally, they proposed a "Rates and Taxes Refund" system similar to GST refunds.
In addition, the jewellery industry is urging the government to introduce duty drawbacks on exports of platinum jewellery, as high import taxes and a lack of duty-free options are making it hard for Indian jewellery makers to compete globally.
