Budget 2022: GJEPC recommends gold import duty cut, special package for sector

Gems and Jewellery Export Promotion Council (GJEPC) on Tuesday urged the government to reduce import duty on gold to 4 per cent from 7.5 per cent and a special package for the sector in the upcoming Union Budget for the fiscal year 2022-23 to boost shipments.

Other recommendations include duty cut and polished diamonds, precious and semi-precious gemstones, etc.

''If (gold) imported at 4 per cent duty rate....working capital amounting to Rs 225 crore would be blocked instead of Rs 500 crore,'' the council said in a statement.

The other suggestions of the council include an amendment in taxation provisions to allow the sale of rough diamonds in Special Notified Zone in Mumbai; clarification on online equalisation levy for business to business international diamond auctions; and extension of the sunset clause for SEZ units, as it would allow the SEZ units to stay competitive in the international markets.

Commenting on the recommendations for the Union Budget for the fiscal FY 2022-23, Colin Shah, Chairman, Gem and Jewellery Export Promotion Council (GJEPC), said India is the fifth largest exporter of gems and jewellery, contributing 5.8 per cent of the global gems and jewellery exports demand of $629.06 billion.

''We will achieve the target of $41 billion for this sector (for the current fiscal). We now target to achieve $100 billion exports when India will observe the centenary of its independence. To kickstart the same, we appeal to the government to announce a special package for the sector in the forthcoming Union Budget,'' Shah said. He added that the only way to further scale up this sector is through policy reforms, which will make us more competitive in the global market.

''We have requested to reduce import duty on cut and polished diamonds; permit the sale of rough diamonds in Special Notified Zone in Mumbai...This will not only help the Indian diamond industry to remain as the largest diamond producer of diamonds in the world but would also help us to become the largest diamond trading hub,'' Shah added.

He also said that the reduction in import duty on precious metals - gold, silver and platinum - would be a step towards making India ''the number one'' exporter of jewellery in the world.  

The Gem & Jewellery Export Promotion Council (GJEPC), set up by the Ministry of Commerce, Government of India (GoI) in 1966, is one of several Export Promotion Councils (EPCs) launched by the Indian Government, to boost the country’s export thrust, when India’s post-Independence economy began making forays in the international markets. Since 1998, the GJEPC has been granted autonomous status.

With headquarters in Mumbai, GJEPC has Regional Offices in New Delhi, Kolkata, Chennai, Surat and Jaipur, all of which are major centres for the industry.