India seems set for a dual import duty structure for gold. Commerce and industry minister Nirmala Sitharaman told HT that her ministry has requested the finance ministry to reduce duties on the precious metal — but only for exporters.
“The gems and jewellery sector has suffered for no fault of theirs due to dips and rises in gold prices,” Sitharaman said. “Many restrictions have been imposed on gold keeping in mind the current account deficit. But it has affected exports.”
She said that while a larger policy could remain applicable for the country, export-oriented sectors required a separate approach, and the government is working towards this.
HT had first reported on December 29 that during the day-long ‘Make in India’ workshop, the gems and jewellery sector had sought reduction of gold import duty from the current 10% to 2%. The industry has set a target of 20% annual growth rate in exports over the next three years.
India’s current gems and jewellery export is estimated at $41 billion (Rs 2.6 lakh crore), and the target is $62 billion (Rs 3.9 lakh crore) in the next three years.
The inward shipments of the metal slumped to 39 tonne in December from a 152-tonne high in November that had threatened to disrupt the CAD, which had widened to $10.1 billion (Rs 63,630 crore) or 2.1% of the gross domestic product (GDP) during July-September.
According to commerce ministry, gold imports so far in January is at a low seven tonnes.