GST Mop-Up Likely to Decide Duty Cut on Gold Imports

gst Duty Cut on Gold Imports

Last year, the ‘December Show’ was discontinued due to demonetisation in November. Obviously, this time around, the organisers were not without jitters even though the shadows had retreated. Marshalling all their energy, they increased the stall count to 800 from 730. But it was hard to guess what would be in store.

“We did everything to regain glow of the show but kept our fingers crossed despite knowing well that demonetization is now a thing of the past. What we have witnessed in the first two days of the show has beaten our own expectations,” said Rajiv Jain, secretary of Jaipur Jewellery Show, one of the very few a non-profit events in the country like India International Jewellery Show.

Exhibitors, who have paid between Rs 1.5 lakh and Rs 3 lakh depending on the size of the stalls, said it’s worth the money and time. “I am quite satisfied with the quality of buyers visiting my stall on the first two-days. Even if I acquire one potential client during the 4-days, I would be quite happy with that. In fact, I had more than one,” said an exhibitor who has taken a smaller stall that displayed ornaments worth a few crore of rupees.

Jain said they had officially invited 180 leading retailers of the country including Tanishq, CaratLane etc. But there are a lot more who have come without any invitation. “As per our estimate, there could be more than 1000 buyers who are in the show,” added Jain, who is also past chairman of Gem & Jewellery Export Promotion Council.

After all, Jaipur has emerged as the leading hub for Kundan Meena, the sought-after jewellery for weddings. Most of these handmade ornaments are sourced from the Pink City by the country’s leading retailers. But Jain said colour-stone studded silver and costume jewellery are also turning the city into a top draw for retailers.

There are about 6,000 jewellers in the state out of which about 800 are into exports, which are not in the pink of health today. Industry expects exports to remain flat this year and wants tweaking of the policy so that it can raise their competitiveness in global markets compared to counterparts in China, Thailand, Dubai, etc.

“While exporters get back the customs duty of 10% and 3% of GST, the capital gets locked for 3-4 months adding stress to the working capital needs. Secondly, interest rates are very high in India compared to China, Thailand, and other countries. If the exporters do well, it also adds fillip to the domestic market,” said Jain.

The industry believes that the 10% customs duty on gold imports needs to be reduced. Jain said the government understands the need but it will only do so if the GST collections meet their expectations. “In a recent meeting with the commerce and industry minister and finance secretary, we raised the issue. The government looked positive on the reduction even though they did not commit anything. But what we understand is that if GST collections meet their targets, they are more likely to reduce the duty to 4% from the current 10%,” added Jain.

News Source: indiatimes

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