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INDIA RAISES IMPORT DUTIES ON DIAMONDS AND JEWELRY, GJEPC WORRIED

In an effort to reduce the country’s current account deficit (CAD), the Indian government has raised the duty on the import of polished diamonds, coloured gemstones and lab-grown stones to 7% (from 5%) and on jewelry and components of jewellery to 20% (from 15%). According to Gem Konnect, a “similar import duty hike has been imposed on precious metal parts for gold and silversmiths”.

 

According to the government, the large deficit and the rupee weakening against the dollar “have put a great deal of pressure on the CAD and the measures are intended to curb any further increase”. The import duties are expected to add an additional ₹4,000 crore ($551 million) in revenue for the government. Meanwhile, the Gem & Jewellery Export Promotion Council (GJEPC) said that the raised duties will affect exports and trade.

 

In a press release, GJEPC Chairman Pramod Agarwal said that the raise would impact all aspects of the diamond and jewelry trade in India and impact “ a large part of employment in the sector”. He added: “Other global trading centres such as New York, Dubai and Israel would be at an advantage and the import duty hike could encourage malpractices in India. We at the GJEPC are constantly working with the government to initiate measures favourable for the growth of exports, and we are hopeful that rupee stability in future would bring relief to the trade”.

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