KOLKATA: The All India Gems and Jewellery Trade Federation (GJF) is planning to put forward a memorandum to finance minister Pranab Mukherjee with a three-pronged agenda to give a fillip to the country’s Rs 1,12,000 crore jewellery industry. This includes asking the government to do away with import duty on gold and silver, abolishing the cap of 99.5% purity on gold that can be imported and allowing import of gold under OGL (open general license).
In the Union Budget 2009-10, the FM had proposed increasing the customs duty on gold bars from Rs 100 per ten grams to Rs 200 per ten gms and that on silver from Rs 500 per kg to Rs 1,000 per kg.
Speaking on the sidelines of EIJS (East India Jewellery Show), the first B2B exhibition on jewellery, gems and allied products in Eastern India, All India Gems and Jewellery Trade Federation ice-chairman Bachraj Bamalwa said: "The gold import duty hike will spur smuggling from countries like Bangladesh, Nepal, Dubai and Pakistan at a time when 100% of the gold is being imported through official channels."
He added that GJF would also be asking for the government to allow import of gold of any purity instead of the 99.5% purity that is standard now. "Right now, a lot of gold from South African mines goes to UK and Switzerland for further purification after which India imports it. If the cap on purity is removed, it would encourage many refineries in India and also open up employment generation," he said.
Incidentally, India imports about 700-800 tonnes every year though last year, the figure had come down to 400 tonnes because of high gold prices and the overall slowdown. "This year, from January to June, only 60 tonnes of gold have been imported," said Mr Bamalwa.
He added that jewellers may be forced to undertake some kind of agitation if their demands are not met.
The Gem and Jewellery Export Promotion Council eastern region chairman Pankaj Parekh said that exports were showing a negative growth of 27% though they had picked up 2% in the last three months. "Exports to the US have fallen, but markets like Hungary, Romania, Kazakhistan and Uzbekistan are gathering steam," said Mr Parekh.
Source : The Economic Times