IBEF: December 08, 2020
The Gem and Jewellery Export Promotion Council of India (GJEPC) on Monday said that if the current rate continues, total shipments are projected to hit about Rs. 1.6 lakh crore (US$ 20-21 billion) in this financial year with improvement in export market conditions.
"If the current export rate continues to be around US$ 2-2.5 million every month, we're going to end the year in the range of US$ 20-21 billion," GJEPC President, Mr. Colin Shah told reporters at a virtual press conference.
He further claimed that exports were steadily improving as the overall shipment decreased by 26.45% in September compared to the same month last year while it decreased to 19% in October and a decrease of just 3.88% in November.
He said, “In the last 3-4 months, throughout the pandemic phase, we have been extremely aggressive in taking various initiatives, especially on the digital front. Our virtual buyer seller meets and connects to the global India that we have been doing every quarter. They've really helped not only to connect the whole trade together, but also to boost industry.”
A number of government initiatives, including the extension of the time limit for the export credit available on the gold loan, interest subsidies, the extension of the interest moratorium and EMI payments, the actual classification of MSMEs, among others have helped to put the industry back to its feet.
The production has also returned to normal, he said, “we are all back in pan-India at 85-90% level already and the 10% that has not returned is only due to COVID-19 or some lockdowns that are still prevalent in some areas of the country.”
In its pre-budget proposal, GJEPC urged the government to reduce the import duty on cut and polished diamonds to 2.5% from the existing 7.5% in order to raise gems and jewellery exports.
In addition, it has proposed that the import duty on cut and polished precious and semi-precious gemstones be reduced from 7.5% to 2.5% and the import duty on precious metals such as gold, silver, and platinum from 12.5% to 4%.
The Council also requested that the basic customs duty of 0.50% on rough coloured gemstones be withdrawn, that the tax provisions be amended to allow the selling of rough diamonds in the Special Notified Zone in Mumbai, that the current Common Facility Centre (CFC) scheme be extended for five years.
Budget allocation of Rs. 200 crore (US$ 27.12 million) to the CFC project on the basis of the precinct that each such project would amount to approximately Rs. 20-40 crore (US$ 2.71-5.42 million) and will entail the establishment of at least one mega CFC in each area.
The proposal also suggested that the Technology Upgradation Fund (TUF) scheme for the gems and jewellery industry, the setting of minimum import prices and the rise in import duties on imitation jewellery, and the implementation of a system of 'Rates and Taxes Refund' similar to GST refunds via the EDI scheme.
It also called for an increase in import duties on cut and polished cubic zirconia from 5% to 15% and a zero duty on rough cubic zirconia to reduce imports of finished goods by 0.50% respectively.
In addition, the council requested an increase in import duties on synthetic cut and polished stones from 5% to 25%, Mr. Shah said.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.