Diamond industry seeks export boosting steps
The slowdown in global markets has impacted the exports of cut and polished diamonds from India. To boost the exports the industry experts suggests central government to introduce special tax.
Slowdown in global markets continues to impact exports of cut and polished diamonds from India. Gems and Jewellery Export Promotion Council (GJEPC) has requested central government to introduce Special Turnover Tax regime for diamond industry with 0.75 per cent tax on sales turnover like it is in Israel, Belgium and Dubai to encourage companies of non-resident Indians to shift capital to India and give a boost to exports.
The latest import-export figures declared by GJEPC show that the exports of polished diamonds in December 2015 decreased by 17.1 per cent at $1.20 billion compared to $1.50 billion in the same month previous year. However, rough diamond imports during the month increased by 2.44 per cent at 1.46 billion, marginally up by 2.44 per cent in value terms from US$ 1.43 billion the previous December.
Exports of cut and polished diamonds fell by 14.63 per cent to $ 14.79 billion this year and imports of rough diamonds fell to $10.12 billion this year, a decline of 23.97 per cent. Gold jewellery (studded and plain) exports were down 22.91 per cent to $6.20 billion in the first nine months of financial year 2016, while that of medallions and coins to $3.70 billion.
Diamantaires are keeping their fingers crossed over business prospects in the USA, one of the world’s largest diamond consuming countries. “Over 200 jewellery stores in the USA have downed their shutters in the last one year and now Walmart has announced closure of 269 stores globally. This indicates deteriorating economic situation in the USA. India exports around $6.50 billion worth of polished diamonds to the USA per annum,” said diamond analyst Aniruddha Lidbide. He said prospects of recovery in global diamond market are very less in the next few months. Exports of polished diamonds are expected to witness a continuous fall due to weak demand in the USA and China.
“We have urged central government to permit sale of rough diamonds at the SNZ in Mumbai by implementing a 0.25 per cent tax on sales turnover achieved at SNZ by foreign mining companies. This would generate a new area of tax collection by shifting sales from Belgium, Israel and Dubai to India,” said GJEPC chairman Praveen Shanker Pandya.
Courtesy: Times of India