Comments
The Gems and Jewellery sector has a reason to cheer after the Finance Minister Nirmala Sitharaman considered most of their stated demands in her Union Budget.
The Finance Minister reduced customs duty on cut and polished diamonds and gemstones to bring it to 5 per cent from 7.5 per cent.
Notably, the Gems and Jewellery Export Promotion Council (GJEPC), along with Gems and Jewellery Federation (GJF) and India Bullion and Jewellers Association (IBJA) had recommended customs duty reduction to 2.5 per cent.
On the sawn diamonds, responding to the trade’s demand for a clarity, the Finance Minister stated that it would “attract nil customs duty.”
Speaking to Businessline on the Budget provisions for the sector, Dinesh Navadia, Regional Chairman - Gujarat, GJEPC, said, “This time, the government has paid adequate attention towards this sector. We have also shown our performance with robust exports. Right now the gems and jewellery sector is having one of its best times. All factors are supportive, The US, Hong Kong and the Middle East markets are also opening up with strong demand.”
No change in gold import duty
There is no change in the gold import duty.
Haresh Acharya, Director, IBJA, said, “There was a duty cut of 2.5 per cent on gold. This year India’s gold imports is crossing 1,000 tonnes, one of the highest in past 4-5 years. So, there was no case for a reduction in customs duty on gold.
Simplified regulatory framework
In order to further boost jewellery export through e-commerce, the Budget also proposes a simplified regulatory framework, which will be implemented by June this year.
Further, the customs duty on pearls 7101 and rhodium imports has been reduced to 5 per cent and 2.5 per cent respectively as against previous rates of 10 per cent and 12.5 per cent respectively.
Imitation jewellery
To “disincentivise import of undervalued imitation jewellery,” customs duty on imitation jewellery was fixed in a manner that a duty of at least “₹400 per Kg” is paid on its import.
Meanwhile, there are concerns on the impact of gold investment demand following the government’s recognition to the digital currency. The trade, however, sees no such threat as the cost of holding gold is less when compared to digital assets, that will now attract 30 per cent tax on each transaction. “On the contrary, this may be a positive for gold investment demand,” said Acharya.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.