Plain Gold Jew­ellery to Gulf Takes a Hit Whole­salers in the Gulf re­gion have started em­ploy­ing jew­ellery ar­ti­sans from In­dia to avoid duty

The Economic Times - - Finance & Commodities - Su­tanuka.Ghosal @times­

Kolkata: Ex­port of plain gold jew­ellery to the Gulf re­gion may take a hit with jewellers in the UAE set­ting up manufacturing units to avoid pay­ing 5% duty on im­ported gold jew­ellery.

In­dian ex­porters fear that a 10% im­port duty on gold in In­dia and a 3% GST is mak­ing In­dian jew­ellery less at­trac­tive in the UAE, where there is no im­port duty on gold as a raw ma­te­rial. In­dus­try ex­ec­u­tives said many jew­ellery whole­salers in the Gulf have started em­ploy­ing jew­ellery ar­ti­sans from In­dia who are adept in hand­crafted jew­ellery, which sees good de­mand in Gulf.

“It is a mat­ter of con­cern that ex­ports of plain gold jew­ellery have de­clined in the UAE,” said Praveen Shankar Pandya, chair­man of Gem & Jew­ellery Ex­port Pro­mo­tion Coun­cil (GJEPC). “This will def­i­nitely have an im­pact on the over­all gold jew­ellery ex­ports in the cur­rent fi­nan­cial year.”

In the first quar­ter of 2017-18, gold 10% im­port jew­ellery ex­ports in value terms dropped by 41.67% from a year ago to .₹ 10,631.74 crore. “The UAE has con­trib­uted to a large ex­tent to this drop. Fall­ing crude prices too have taken away dis­pos­able in­come from UAE buy­ers,” said Pandya.

Ra­jiv Po­p­ley, di­rec­tor of Po­p­ley & Sons, who has stores in Dubai, said though they are not set­ting up a manufacturing unit there, they have en­tered into strate­gic tie-ups with manufacturing fa­cil­i­ties in the UAE to sup­ply jew­ellery to their stores. Ahammed MP, chair­man of Mal­abar Gold & Di­a­monds, said af­ter GST launch, there is an in­crease in sale of gold in the UAE and In­di­ans are said to among the top buy­ers. “The im­me­di­ate trig­ger is the re­vised tax struc­ture for gold in In­dia. UAE price con­tin­ues to be lower in com­par­i­son,” he said.

Fall in value terms Value of jew­ellery ex­ported

duty and 3% GST mak­ing ex­ports less at­trac­tive

no im­port duty on gold as a raw ma­te­rial

prices have taken away dis­pos­able in­come from UAE buy­ers

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