Special Notified Zone for diamond miners to be announced in Budget 2015

A special notified zone for diamond miners will help develop India as a trading hub of rough diamond and help small diamond traders.

Diamond miners and traders are expecting announcement of Special Notified Zone for diamond business in the upcoming Budget. This zone will help global miners’ import and trade rough diamonds in India without inviting income and tax assessments. Such announcement will help develop India as a trading hub of rough diamond and help small diamond traders in the country.

At the CII Partnership Summit at Jaipur, Rajasthan, Commerce and Industry Minister Nirmala Sitharaman raised some issues related to the gems and jewellery sector and also hinted at some big announcement likely to be made in the budget. “On 29 November, when sectoral discussions happened with the Prime Minister under the ‘Make in India’ umbrella, the gems and jewellery sector was the major talking point. That day itself a presentation was made before the Prime Minister and the finance minister on this issue, along with an action plan. A lot of thinking on the sector is on. You can see its impact in the upcoming budget,” Sitharaman said.

A Gems and Jewellery Export Promotion Council (GJEPC) member said the government has almost agreed on the matter. Pankaj Parekh, vice-president, GJEPC, said though the foreign trade policy allows consignment import of rough diamond into India, due to the absence of custom notification, free import and sale of rough diamond on consignment basis is not possible in India. As a result, the diamond manufacturers of Gujarat have to travel to Dubai, Belgium or Israel to purchase raw material, which imposes huge extra costs. Parekh said that the Bharat Diamond Board has zeroed in on a 4,000 sq. ft hall in Mumbai which could be declared Special Notified Zone, where such trading can happen. “This hall will have 16 chambers with state-of-the-art security and will have bomb-proof walls,” he added. Parekh claimed that since many of these miners are from Russia, apart from Africa and Australia, the issue had been discussed during Russian President Vladimir Putin’s visit to India, and that Prime Minister Narendra Modi had assured him of such a step being contemplated.

Though India polishes 85 per cent of rough diamonds, only 15 per cent of them are imported directly, the rest being bought by middlemen. This step is likely to help the rough diamond polishing industry in Surat. Speaking at the summit, Sitharaman said the government is contemplating allowing states to have brand ambassadors in foreign embassies to promote their merchandise and services exports. Railways minister Suresh Prabhu said one of the key functions of the National Institute for Transforming India (NITI), which has replaced the Planning Commission, will be to handhold the states for building on their natural advantages. Rajasthan chief minister Vasundhara Raje Scindia said her state has carried out major labour reforms without compromising the interests of workers. She said the state is soon going to establish a skill university.