GJEPC: Jew­ellery Im­port Duty Hike To Strengthen In­dian Man­u­fac­tur­ing

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The gov­ern­ment re­cently in­creased the cus­toms duty on cat­e­gories of di­a­mond such as semi-pro­cessed, half-cut or bro­ken, and cut and pol­ished coloured gem­stone to 7.5%, from 5% ear­lier, and in­creased im­port duty on jew­ellery ar­ti­cles from 15% to 20% in a move to nar­row the cur­rent ac­count deficit (CAD).

GJEPC chair­man Pramod Ku­mar Agrawal said, “GJEPC wel­comes the step un­der­taken by the gov­ern­ment to nar­row the cur­rent ac­count deficit.

“The move to in­crease the im­port duty on jew­ellery from 15% to 20% would not only help the sec­tor strengthen jew­ellery man­u­fac­tur­ing in In­dia, but also give a boost to jew­ellery ex­ports from In­dia, a step to­wards es­tab­lish­ing Brand In­dia jew­ellery.”

He added, “The im­port duty in­crease in cut and pol­ished di­a­monds and pro­cessed colour gem­stone from 5% to 7.5% would in­crease the cost of busi­ness for the sec­tor and im­pact ex­ports and trade. In­dia, a global leader in di­a­mond pro­cess­ing, is not just a hub for pro­cess­ing roughs, but also caters to var­ied forms of re-pro­cess­ing of di­a­monds and di­a­mond jew­ellery. A sub­stan­tial size of cut and pol­ished di­a­monds sold to clien­tele world over, in the form of ei­ther loose or set in jew­ellery are im­ported for re-set­ting in new de­sign or prod­ucts as de­sired by the cus­tomers.

“There are bro­ken, dam­aged sold goods and semi-pro­cessed stones, too, that form con­sid­er­able part of im­port of cut and pol­ished di­a­monds. This would lead to prac­ti­cal in­con­ve­nience and limit the busi­ness of cut­ting and pol­ish­ing im­pact­ing large part of the em­ploy­ment in the sec­tor.

“Other global trad­ing cen­tres such as New York, Dubai, Is­rael would be at an ad­van­tage and the im­port duty hike could en­cour­age mal­prac­tices in In­dia,” the chair­man com­mented, adding, “Pro­cessed coloured gem­stones, too, form sig­nif­i­cant com­po­nent for jew­ellery, and hike in the tar­iff will hurt the busi­ness. GJEPC would rep­re­sent the con­cerns to the gov­ern­ment to find a mech­a­nism that would help min­imise the im­pact on ex­ports.”

In­dia is a pre­dom­i­nant global leader in cut­ting and pol­ish­ing of di­a­monds con­tribut­ing 70% by value, 85% by vol­ume and 92% by pieces. In­dia ex­ported a to­tal of $23 bil­lion worth of cut and pol­ished di­a­monds and $9.7 bil­lion worth of plain and stud­ded jew­ellery in the fi­nan­cial year 2017-18.

Pramod Agrawal

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