Ø Seeks reduction in gold import duties
as global oil & gold prices have fallen
Ø Urges Government to exclude jewellery
from all FTAs
Ø Seeks a comprehensive gold mining
policy that encourages domestic exploration
Ø Urges Government to stimulate
enhanced recycling schemes for idle gold
Mumbai, January 15, 2015: As part of its pre-Union Budget recommendations, All
India Gems and Jewellery Trade Federation (GJF), the national nodal and the
largest single trade body in India for the promotion and growth of trade in
gems and jewellery across India, has urged the Union Finance Minister to bring
down the duty on gold from 10% to 2% to encourage ‘Make in India’ initiative in
the gems & jewellery sector. At present, the current account deficit is
under control due to reduction in global gold prices (40% down) from USD 1,900
to USD 1,200 today. Fortunately, crude prices (which account for the highest
bill for imports) have reduced 60% in last 6 months.
According
to the GJF, increasing import duty on gold has neither helped the Government
nor the trade – very few have benefitted and smuggling increased. Referring to
these dynamically changing macro-economic indicators, GJF has reiterated its
demand for the Government to formulate a comprehensive gold policy for India
and make India a global jewellery hub.
GJF
has categorically asked the Government to exclude jewellery from all bilateral
or multi-lateral free trade agreements (FTAs). Stating that the Government
should not encourage jewellery imports at cheaper rates, GJF referred to the
earlier FTA with Thailand - which was a failure as it discouraged indigenous
jewellery manufacturing.
Mr.
Haresh Soni, Chairman, GJF, said, ““Keeping in mind, Hon. Prime Minister’s
vision of promoting ‘Make In India’ brand we have to protect & nurture our
indigenous industry. Both oil and gold prices globally have fallen
substantially now vis-à-vis last few years. We propose that the difference
between import duty of raw material (gold & silver) and finished jewellery
(gold & silver) to be maintained at minimum 10% (for gold) and 15% (for silver).
Jewellery manufacturing cluster should be revamped by including common facility
center and skill upgradation. And we also urge the Government to create a
comprehensive gold mining policy for domestic exploration and for cluster
development for ‘Make in India’ fashion jewellery. This will also encourage
NRIs to buy jewellery from India.”
Mr.
Manish Jain, Vice Chairman, GJF, said, “To provide incentive for the organised
manufacturing facility, Government must reintroduce metal gold loans (MGL) and
innovative finance options for sector. If we are not competitive on the global
front, we won’t be able to become a global hub and therefore MGL rate of
interest should be at par with international rate (3.5 to 6% in India vis-a-vis
1.5% in international markets). We seek removal of excise duty on fashion
jewellery and also abolish excise duty on precious metals as Government is not
earning any revenue on it. As India is a vast country, the Government must
facilitate more friendlier and accessible rules for transportation from
manufacturing hubs to airports/ ports. Government has to offer incentives for
importing technology as many indigenous processes are still manual.”
GJF
has urged the Government to monetize existing investment and reduce import
burden through recycling the large gold reserves held with temple trusts,
banks, NBFCs and retail customers. It has also sought widening of the
availability of gold deposit schemes through banks making them more attractive
to people. It hopes that the Government will liberalize regulations affecting
value chain through reduction of import duty, increased finance options and
ensuring consumer protection through standardization. It has asked for a
multipronged approach to improve industry opaqueness through better industry
and consumer interface, enforce hallmarking standards, diligence in sharing of
information or listing of companies, greater transparency and elimination of
unofficial supply of gold.
GJF
has urged the Government to develop infrastructure to improve skill sets
through upgradation and skill development by promoting and standardizing
professional vocational courses, introducing fee subsidies, offering
scholarship programs, reviving dying arts and crafts, more training. It has
urged the Government to roll out the National Skill Certification and Monetary
Reward Scheme (NSCMRS) to increase productivity and attract young manpower. It
has sought an increase in investment in technology to improve health and
working conditions as well as labour productivity. It has asked the Government
to provide adequate thrust for skill and infrastructure development through
easy financing, incentives, subsidies, facilitation of land allocation, and
supply of utilities.
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