Budget 2024 wishlist of gems & jewellery sector: From EMI options for jewellery purchases to gold import duty cut

The Gems and Jewellery Export Promotion Council urged the government to take measures to revive exports in this sector

The gems and jewellery sector has put forward a list of demands the industry is seeking from the upcoming Budget.

Last week, the industry leaders held a pre-Budget consultation meeting with Union finance minister Nirmala Sitharaman and other government officials.

During the meeting with Sitharaman, the industry said it contributes around 10 percent to total merchandise exports, but the sector has been facing some headwinds because of geopolitical concerns.

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Against this backdrop of the macroeconomic scenario, the Gems and Jewellery Export Promotion Council urged the government to take measures to revive exports in this sector.

What are the demands?

-Reduction in the import duty on gold from the current rate of 15 percent to 10 percent

-Special benefit of 0.5 percent duty for importing via India International Bullion exchange (IIBX)

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-Establishment of ‘GST Bonded warehouse’, where duty is paid but GST is not paid. This will be on lines of custom-bonded warehouse

-Creation of Electronic Gold receipt (EGR) through ‘GST Bonded warehouse’. This will enable trading on EGR on exchanges

-Allowing all import of gold only via IIBX and permitting bullion export through IIBX

-Setting up of jewelery export centre at GIFT-CITY for domestic traders

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-Mandatory hallmarking across the country for jewellery

-Stopping import duty benefits for least developed countries (LDC) and free trade area (FTA) countries as it distorts the market, according to the industry. Moreover, bringing silver duty at par with gold under CEPA.

Currently import duty on gold under UAE CEPA agreement is 14 percent, but duty on silver is 9 percent.

-Gradually moving to 100 percent bullion trade through commodity exchange only

-Permitting EMI on jewellery purchase

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-Allowing income tax exemption on interest from sovereign gold bonds. Additionally, it sought the removal of capital gain tax on gold and jewellery sales to boost monetisation and bringing down imports

-Allowing lending and borrowing of bullion through commodity exchange

-Single regulator for the gems and jewellery sector

-Sale of rough diamonds in special notified zones through safe harbour rule and to expand the ambit of entities entitled to operate through SNZs.

-Permission for globally-recognised diamond broking/trading houses to operate from SNZs

-Introduction of diamond imprest licence, which will provide level playing field for Indian MSME diamond exporters

-Introduction of duty drawback on exports of platinum jewelry

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