The Gems and Jewellery industry which contributes 7.5% to India’s Gross Domestic Product (GDP) and 14% to India’s total merchandise exports welcomed Finance Minister Nirmala Sitharaman’s proposal on slashing import duty on cut and polished diamonds and gemstones to 5 percent from 7.5 percent while on the sawn diamond to nil in order to boost the sector.
Sitharaman also announced that the government will facilitate the export of jewellery through e-commerce for which it will implement a “simplified regulatory framework” by June this year.
Commenting on the announcement, Ahammed MP, Chairman, Malabar Gold & Diamonds, said, “The budget set a roadmap for a sustainable economic recovery based on infrastructure development and agricultural reform. It has also proposed measures for comprehensive economic development across the region. All these measures will definitely boost consumer sentiment and will have a favourable impact on organised jewellery retail. The customs duty cut on polished diamonds gemstones will boost diamond jewellery sales as prices will go down. Overall, it’s a budget which is firmly in the line of inclusive development.”
Suvankar Sen, CEO, Senco Gold & Diamonds also welcomed the government move, “FM’s announcement of the reduction in customs duty on cut and polished diamonds and gemstones and plan to develop a simplified regulatory framework to facilitate the export of jewellery through e-commerce are positive steps which will enable the sector to grow in the country and boost exports.”
“We look forward to its implementation later this year. The reduction in import duty on diamonds will help generate increased demand for diamond jewellery in the market. Overall, the focus on investment in infrastructure is positive for the economy, also the review of the Special Economic zones Act will help boost the export infrastructure,” Sen added.