GJEPC Meets India’s Commerce Minister

New Delhi: A meeting was held under the chairmanship of Smt. Nirmala Sitharaman, Hon’ble Minister of State (Independent Charge) for Commerce & Industry on 5th April, 2016 to address the current challenges faced by various export industries. The meeting was attended by representatives of the various Export Promotion Councils and related associations who made representations on the support expected from the Government of India in the present scenario.

GJEPC was represented by Mr. Praveenshankar Pandya, Chairman; Mr. Sabyasachi Ray, ED; Mr. K.K.Duggal, Director and Archana Gautam, Sr. Manager. The meeting commenced with a welcome address by Mr. Ravi Capoor, Joint Secretary, DoC and a presentation by DGFT on India’s Exports and Imports: Current Challenges & Government Efforts.

Following this, the individual delegations made presentations. Chairman GJEPC raised certain critical issues facing the industry. He said that in the last five decades, with the exception of 2008, the year of the global crisis, the industry registered steady growth till now. But in 2015-16, exports have declined by over 15% due to the critical slowdown in key markets.

India is established as a leader in all key segments, but never sought any subsidy/incentives during the last three years. Currently, the diamond sector is facing the challenge of an extremely high inventory carrying cost.   Against this background, he requested the government to take some key initiatives to support the sector, such as: Inclusion of gems and jewellery sector under Interest Subvention and MEIS Schemes This will ensure a level playing field in this turbulent phase and prevent China from taking market share from India.

Permission for Job Work:

To bring India on par with China, government should permit goods to enter the country on consignment basis for manufacturing. Already many diamantaires from other countries send goods to China for this purpose, though labour cost there is high. Such business can come to India and will create additional jobs for artisans/karigars in the country

Sale in Special Notified Zone:

Government was requested to permit the sale of rough diamonds at the SNZ by implementing 0.25% tax on sales turnover achieved at SNZ by Foreign Mining Companies

Roll back of 1% excise duty on jewellery:

After speaking about the meeting held with Mr. Piyush Goyal, Hon’ble Minister on 19th March, 2016 in New Delhi, and welcoming formation of a committee and other steps taken to address the issue, Chairman pointed out that jewellers across the country are highly agitated and requested a roll back.

Export Credit Guarantee Corporation issue:

Stating that the new policy on this issue has increased the transaction cost for exporters by over 20%, Chairman requested to keep the earlier prevailing system unchanged and provide relief to SMEs.

Availability of duty-free gold from the nominated agencies:

Chairman pointed out that the Replenishment Scheme is still not operational and jewellers and exporters are still facing issues in procurement of duty-free gold from the nominated agencies/banks.

The minister voiced her opinion over the job work issue and raised concerns regarding the re-export of entire lot/consignment from the country, as well as the methodology to be adopted by the customs to ensure the entire re-export of each particular consignment. She requested for a detailed note with suggestions regarding the methodology. After hearing the presentation, Smt. Sitharaman asked the Commerce Secretary to organize an exclusive meeting with a delegation of GJEPC to discuss all these issues in detail.