The Hindu Business Line : Gem and jewellery exports up 29 pc at $15.7 b — GJEPC prefers exemption system over refunds for VAT

Mr Bakul Mehta (right), Chairman, Gem & Jewellery Export Promotion Council, with the Director-General of Foreign Trade, Mr K.T. Chacko, at a press conference in the Capital on Wednesday. - Ramesh Sharma

New Delhi , April 20

GEM and jewellery exports surged 29.27 per cent in dollar terms to touch $15.68 billion during April-March 2005 compared with $12.13 billion in the same period during the previous year.

In rupee terms, gem and jewellery exports increased by 26.44 per cent in fiscal 2004-05 to Rs 70,240.69 crore (Rs 55,554.50 crore).

Cut and polished diamond exports continued to enjoy the lion's share, with exports from this category touching a level of $11.18 billion during April-March 2005 ($8.63 billion).

Gold jewellery exports during fiscal 2004-05 increased by 42.16 per cent to $3.81 billion ($2.68 billion). Coloured gemstones exports during fiscal 2004-05 stood at $0.19 billion ($0.18 billion).

The export target for the gem and jewellery sector for the fiscal 2005-06 and 2006-07 has been pegged at $18 billion and $20 billion respectively. "We will work towards achieving this target," Mr Bakul Mehta, Chairman of the Gem and Jewellery Export Promotion Council (GJEPC), told a press conference here on Wednesday.

At the same time, Mr Mehta also underscored the need for the Government to bring down transaction cost for exporters.

Mr Mehta raised the issue of payment of value-added tax by exporters. "I don't understand the refund system. The VAT laws passed by States like Maharashtra are silent on how to get the refund. We would prefer the exemption system to the refund system." Mr Mehta also made a case for keeping the sector out of the purview of "transfer pricing" regulations. Further, the GJEPC Chairman suggested the Customs duty on diamonds be brought down from 5 per cent to `nil' to enable the conversion of India into a trading hub for gems and jewellery.

Web sites: Inaugurating two Web sites of the GJEPC, which have been created to market two forthcoming events of the council, the Director-General of Foreign Trade (DGFT), Mr K.T. Chacko, said that India has emerged as a major sourcing point for gems and jewellery besides cut and polished diamonds.

The two forthcoming events are `International diamond conference - Mines to market 2005' to be held in Mumbai on May 24-25 and the `India international jewellery show ' to be held in Mumbai from July 14 to 18.

Mr Chacko said the sector has been receiving the attention of the Ministry of Commerce through policy initiatives that would enhance competitiveness of the industry. The DGFT also highlighted that there has already been a sea change in the country's policies to enable the sector access raw materials at competitive cost.

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