The meeting was chaired by Hon’ble Union Minister for Commerce & Industry and Railways, Mr. Piyush Goyal. Hon’ble Ministers of State for Commerce & Industry, Mr. Hardeep Singh Puri and Mr. Som Parkash also participated in the deliberations along with Commerce Secretary Dr. Anup Wadhawan; Secretary, Department for Promotion of Industry and Internal Trade Mr. Ramesh Abhishek; DGFT Mr. Alok Chaturvedi; CEO NITI Ayog Mr. Amitabh Kant and senior officials of Ministry of Commerce & Industry and other departments.
The chairman extended heartfelt congratulations on behalf of the entire Indian gems and jewellery industry to Mr. Goyal on assuming charge of the MoC&I and said that with an experienced and accomplished person such as him at the helm, the gems and jewellery sector is confident of achieving its objective of touching US$ 60 billion exports and generating employment for six million persons by 2020.
On behalf of the export industry, he also raised a few critical issues that needed to be addressed, adding that “resolving the same will bring back our sector on the growth track”.
These include:
1. Imposition of IGST on re-import of consignment of jewellery and diamonds respectively exported through the mode of exhibitions/ export promotion tours/consignments
Carrying good on consignment for overseas jewellery exhibitions /export promotion tours is a common and popular mode, so sudden imposition of IGST on them has critically affected the trade. The issue has already been flagged to the senior officials of both Department of Commerce and Department of Revenue, but has still not been resolved.
2. Stoppage of Replenishment Scheme in the country
Due to certain amendments in the Para 4.34 of Foreign Trade Policy availing of replenishment scheme by exporters has been disallowed. The issue has already been raised numerous times with DGFT, DGEP and Additional DGEP. Small and medium jewellery exporters majorly rely on this scheme.
3. Inclusion of gems and jewellery sector under 3% Interest Subvention Scheme on Pre- and Post-Shipment rupee export credit
In an earlier meeting in January 2019 under the chairmanship of the then Commerce Minister, the industry was expressly assured that gems and jewellery sector will be included under the 416 tariff lines identified under 3% interest subvention scheme (wherein merchant exporters were recently included). However, this has still not happened.
4. Special Economic Zones
The Department of Commerce has constituted a Committee under the Chairmanship of Shri Bana Kalyani to study the SEZ policy in the country. Recommendations of the Committee for boosting the export of gems and jewellery items from SEZs across the country may be implemented at the earliest.
5. Severe Procedural Bottlenecks at PCCCC, Mumbai impeding the export/import from Mumbai port
Diamond exporters are facing several difficulties on account of Office Note issued on 4th May 2019 by Mumbai Customs regarding variation in dimension of cut and polished diamonds & variation in valuation of rough diamonds. As there are no standard global norms in the valuation of rough diamonds and for examining the dimension of polished diamonds, exporters are facing several difficulties.
6. Reduction in Import Duty on G&J Items
There is a need to provide relief from the existing high import duty on key segments of the sector. The industry has asked for a reduction in import duty on Cut and Polished Diamonds & Precious and Semi-Precious Gemstones from 7.5% to 2.5% and on Gold from 10% to 4%.
The Chairman also highlighted a few other issues such as
• Need for allocation of a special package for the gems and jewellery sector to increase its exports and employability in the country
• Major banks not assessing export credit in foreign currency which is depriving the exporter from utilizing the entire credit limit on account of the depreciating rupee
• Extension of the benefit of 3% IGST exemption to Silver and Platinum and to all the nominated agencies as mentioned in the Para 4.41 of the FTP
• Huge Blockage of Input Tax Credit (ITC) on account of inverted duty structure.
