All India Gems & Jewellery Trade Federation welcomes Govt’s move to abolish 80:20 Rule; seeks duty cut to curb smuggling
GJF urges Prime Minister to include gems & jewellery in ‘Make in
India’ initiative
GJF also proposes unlocking of idle gold in households & trusts to
reduce CAD
GJF seeks nodal Ministry for representing the domestic gems &
jewellery sector
December 1, 2014: All India Gems and Jewellery Federation (GJF), the national
nodal and the largest single trade body in India for the promotion and growth
of trade in gems and jewellery across India, has welcomed the Government’s move
to abolish the 80:20 Rule for gold imports and expressed its gratitude to Prime
Minister Shri Narendra Modi, Union Finance Minister Shri Arun Jaitley, Smt.
Nirmala Sitharaman (Union Minister of State for Commerce & Industry) and
all bureaucrats from the relevant ministries and Reserve Bank of India. The
move to abolish 80:20 Rule comes close on the heels of GJF’s letter to Prime
Minister Shri Modi last week and persistent efforts with key policy makers for
more than 12 months. It also comes as a relief to all those people who are
buying gold & jewellery during the wedding season.
GJF has proposed unlocking of idle gold in the country to the
tune of 1,000-1,500 tonnes within 3 years through Rashtriya Swarn Nivesh to
reduce CAD further. GJF also sought the formation of a nodal Ministry to represent
it. Considering that the Government (through RBI notification dated November
28, 2014) has withdrawn the provisions contained in A.P.(DIR Series) Circular
No.25 dated August 14, 2013 and the subsequent clarifications issued from time
to time, resting with the A.P. (DIR Series) Circular No.133 dated May 21, 2014,
GJF has also sought clarity on whether circulars prior to August 14, 2013,
including those on restrictions on import on a consignment basis and gold loan
(issued in May 2013) still prevail – if they are, then the latest circular is
more restrictive instead of being beneficial to the trade.
Mr. Haresh Soni, Chairman, GJF, said, “We sincerely thank the
Prime Minister, Union Ministers and bureaucrats for giving a fresh lease of
life to the gems and jewellery sector, which has been gasping for breath. On
behalf of all member Associations across India, we reiterate our support to the
Government for its various initiatives to remove trade distortions while
stimulating growth in the economy and overall development. GJF also recognizes
its responsibility of self-regulation.” He added, “We urge the Government to
initiate the process of creating a comprehensive gold policy and we shall
support it wholeheartedly. We are hopeful that gold supply will be better now
and lakhs of craftsmen will be able to get jobwork. However, we urge the
Government to curb smuggling from neighbouring countries by reducing gold
import duties. Considering that the gems & jewellery sector has been going
through tough times, GJF also sought the formation of a nodal Ministry to
represent its sad plight and sorry state.” GJF has proposed a national debate
on this matter because gold is part and parcel of the common man’s life since
thousands of years.
Mr. Manish Jain, Vice Chairman, GJF, said, “GJF urges the
Government to bring down the duty on gold from 10% to 5% first and then 2%
eventually as it will make smuggling unprofitable. The hike of import duty on
gold has built a parallel economy, leading to widescale gold smuggling, which has
increased manifold to beyond 200 tonnes. Bringing down duty would eliminate
smuggling and also deployment of any black money for this process.”
Mr. Bachhraj Bamalwa, Director, GJF, added, “We also urge the
Government to include gems & jewellery sector in ‘Make in India’ initiative
and encourage India’s glorious legacy of handcrafted jewellery making. Unlike
many other mega imports of other products, the gems & jewellery sector
creates value addition, provides employment and encourages indigenous manufacturing.
Jewellers are mostly self employed entrepreneurs and already engaged in
promoting the Prime Minister’s concept of ‘Make in India’.” He added. The
country’s problems are ours too. We are there to help the Government by joining
hands with it as and when needed. We shall make sure that the Country’s CAD
situation doesn’t deteriorate due to unnecessary gold imports.”
“Keeping in mind, Hon. Prime Minister’s vision of promoting
“Make In India” brand we have to protect our manufacture industry. We propose
that the difference between import duty of raw material (gold & silver) and
finished jewellery (gold & silver) to be maintained at minimum 10% (for
gold) and 15% (for silver). When the manufacturing of jewellery in India will
be costlier after paying the import duty and premium, than there will be a
tendency to import finished jewellery directly from abroad. This deprives lakhs
of livelihood in the manufacturing industry,” he added.
Mr. Ashok Minawala, Director, GJF, said, “GJF sees the
possibility of unlocking idle gold in India through jewellers and bank. The
Rashtriya Swarn Scheme can be a pioneering initiative to help the Indian
Government's national agenda of reducing import of gold and discovering
alternative sources of gold. Eligible jewellers will work as nominated agents
of the Bank and will help collect unused and idle gold from households and
temple trusts. In three years, we can help mobilise 1,000 to 1,500 tonnes of
unused/ idle gold and make India free from importing gold for domestic consumption."
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