What does the jewellery sector expect from FM Sitharaman? | Budget 2024 News

EU budget

Finance Minister Nirmala Sitharaman to present Union Budget 2024 on July 23

Ahead of the Union Budget 2024, there are reports that the jewellery industry is expecting possible cuts in customs duties on gold, silver, diamonds and platinum.

The wait is significant because it coincides with the wedding and holiday season, a time when jewelry is typically in high demand, according to the report Mint.

India’s gemstone and jewellery sector relies heavily on imported raw materials such as gold, diamonds, silver and coloured gemstones. The industry employs about 4.3 million people, contributes about 10 per cent of the country’s merchandise exports and is a key driver of economic growth, the report said.

The news report quoted Vipul Shah, chairman of the Gem and Jewellery Export Promotion Council (GJEPC), as saying that the industry is currently facing headwinds due to the geopolitical climate, introduction of the beneficiation programme and challenges in sourcing rough diamonds. “I urge the Hon’ble Finance Minister to introduce a safe harbour provision in the SNZ, introduce a Diamond Imprest Licence and reduce the import duty on gold, silver and platinum bars to 4 per cent; and introduce duty drawback on export of platinum jewellery to take advantage of India’s CEPA UAE agreement…,” Shah said.

EU Budget 2024: Expectations

The GJEPC has proposed to reduce import duty on gold bars (HS code 7108) from 15 per cent to 4 per cent. This revision is expected to release around Rs 982.16 crore from the duty blockage, thereby providing additional working capital to the industry, the report said.

The council also recommended reducing the import duty on silver bars from 10 percent to 4 percent and on platinum bars from 12.5 percent to 4 percent.

The report indicated that in order to further develop and improve the Special Notification Zones (SNZs), the GJEPC had requested the Centre to allow internationally recognised diamond brokerage and trading companies such as Bonas and I Hennig to operate in these zones.

The GJEPC has urged the Centre to fulfil its long-standing request to allow the sale of rough diamonds in Specially Notified Zones (SNZs) under the Safe Harbor principle and to expand the types of entities permitted to operate in these zones, the report said.

Currently, the SNZ only hosts viewing sessions organized by mining nations. The main objective of establishing the SNZ was to provide easier access to rough diamonds, streamline procurement processes and enable foreign diamond mining companies to sell their products directly to Indian producers.

First published: July 11, 2024 | 17:07 IST