The Gem & Jewellery Export Promotion Council (GJEPC) has voiced strong concerns regarding the recent increase in gold import duty and Agri cess, while simultaneously proposing proactive industry-led solutions aimed at reducing import dependence, revitalising the Gold Monetisation Scheme, and safeguarding India’s gem and jewellery export sector amid mounting economic pressures.
Quick Summary
- GJEPC acknowledged the Government’s decision to raise gold import duty from 5% to 10% and Agri cess from 1% to 5%.
- The Council reaffirmed its commitment to the ‘Nation First’ vision advocated by Prime Minister Narendra Modi.
- GJEPC proposed promoting lower caratage jewellery such as 14K and 9K to reduce gold imports by 20–30%.
- The Council encouraged old gold exchange programmes and revival of the Gold Monetisation Scheme (GMS).
- GJEPC cautioned that higher import duties may fuel smuggling and increase export costs.
- MSME manufacturers, which form 80% of GJEPC membership, are expected to face severe liquidity challenges.
GJEPC Meets Industry Stakeholders to Propose Solutions
In response to his call, GJEPC convened a meeting yesterday with major retailers and manufacturers. We have written to the Prime Minister outlining proactive measures from our members to curb gold imports and bolster self-reliance:
- Promote sales of lower caratage jewellery (e.g., 14K and 9K) to reduce imports by 20-30%
- Encourage consumers to exchange old gold for new jewellery making, further decreasing import dependence.
- Revamp the Gold Monetisation Scheme (GMS) to tap India’s 25,000 tonnes of grandfather stock.
- Discourage investment in gold bars, billets, and coins, which account for 20-30% of total imports.
- Provide special policy framework for gold jewellery exporters to earn precious foreign exchange amid economic challenges.
Detailed Proposal on Gold Monetisation Scheme
We are submitting a detailed paper on revitalizing GMS for the Government’s consideration.
GJEPC Warns Against Impact of Higher Import Duties
That said, GJEPC’s consistent position is that hiking import duties rarely curbs gold imports—it merely inflates prices. Despite gold prices doubling recently, imports have not declined proportionally. Such measures often fuel smuggling and escalate export costs.
Exporters Face Working Capital Challenges
Exporters now face Bank Guarantees of ₹28-30 lakhs per kg of duty-free gold from Nominated Agencies, severely blocking working capital and stifling exports.
MSMEs Expected to Face Severe Liquidity Crunch
The most severe impact of this policy will be felt by MSME manufacturers, who are the “backbone” of our industry, accounting for 80% of GJEPC’s membership, who are currently facing a critical liquidity crunch.
GJEPC Calls for Sustainable and Balanced Policy Solutions
GJEPC urges the Government to engage in dialogue for sustainable solutions that align fiscal goals with export growth.
About The Gem and Jewellery Export Promotion Council (GJEPC)
The Gem & Jewellery Export Promotion Council (GJEPC), set up by the Ministry of Commerce, Government of India (GoI) in 1966, is one of several Export Promotion Councils (EPCs) launched by the Indian Government, to boost the country’s export thrust, when India’s post-Independence economy began making forays in the international markets.
GJEPC Granted Autonomous Status
Since 1998, the GJEPC has been granted autonomous status.
GJEPC Represents Over 10,900 Industry Members
The GJEPC is the apex body of the gems & jewellery industry and today represents 10900+ members in the sector.
GJEPC’s National Presence Across Major Jewellery Hubs
With headquarters in Mumbai, GJEPC has Regional Offices in New Delhi, Kolkata, Chennai, Surat and Jaipur, all of which are major centres for the industry. It thus has a wide reach and is able to have a closer interaction with members to serve them in a direct and more meaningful manner.
GJEPC’s Continued Efforts to Expand Industry Support
Over the past decades, GJEPC has emerged as one of the most active EPCs and has continuously strived to both expand its reach and depth in its promotional activities as well as widen and increase services to its members.cent of its profits to social responsibility initiatives in the same country of operation.
FAQs
What changes were announced in the recent gold import policy?
The Government increased gold import duty from 5% to 10% and Agri cess from 1% to 5%.
What measures has GJEPC proposed to reduce gold imports?
GJEPC proposed promoting lower caratage jewellery, encouraging old gold exchange, revamping the Gold Monetisation Scheme, discouraging investment in gold bars and coins, and creating supportive policies for exporters.
Why is GJEPC concerned about higher gold import duties?
According to GJEPC, higher duties may inflate gold prices, encourage smuggling, increase export costs, and create working capital challenges for exporters.
How will MSMEs be affected by the new policy?
GJEPC stated that MSME manufacturers, which account for 80% of its membership, are likely to face severe liquidity challenges due to increased financial pressure.
What is the Gold Monetisation Scheme (GMS)?
The Gold Monetisation Scheme is a Government initiative aimed at mobilising idle gold holdings in India and bringing them into the formal economy.
Why is GJEPC advocating lower caratage jewellery?
GJEPC believes promoting 14K and 9K jewellery can help reduce gold imports by 20–30%.
Source: SVAR Media Network
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