The gems & jewellery industry has asked the government to pare import duties on gold from 10 per cent to 4-5 per cent and extend the benefits of the merchandise export from India scheme (MEIS) to the sector to offset the impact of the value added tax in Dubai to be introduced from January 2018.

“We expect our exports to stagnate at $43 billion this year because of the existing high customs duty on gold, the implementation of the Goods & Services Tax, low global demand situation and the value added tax to be introduced by Dubai in January. Exports can increase only if the government brings down import duty and gives the industry an incentives package,” said Praveenshankar Pandya, chairman, Gems & Jewellery Export Promotion Council at a press conference on Monday.

While the industry was earlier estimating a 10 per cent growth in exports in 2017-18 compared to the previous fiscal, Pandya said that it will not happen without government intervention.

The GJEPC has already made its representation to the Finance Ministry and the Commerce Ministry and is hopeful of some favourable action on the import duty front before the Union Budget for 2018-19.

The Commerce Ministry, too, has been making a case for lowering of import duty on gold from 10 per cent to 2 per cent.

The GJEPC has also called for a five-year comprehensive gold policy and a single regulator for the sector. “We want a five-year gold policy on the lines of the foreign trade policy. While all departments concerned should pitch in to formulate the policy, the regulation should be done by only one, preferably the Commerce & Industry Ministry,” Pandya said.