Gold Duty Likely To Be Brought Down To 6%

This Is In Wake Of Drastic Decline In Import Duty On The Yellow Metal

Mumbai : There could be good news for those who want to buy gold

in the coming days. The government is likely to reduce import duty on the yellow metal from 10% to 6% in the coming Union budget.

According to market sources, the reduction in duty will be in the wake of a significant decline in gold

import. Besides, sources said the duty on gold

jewellery could be hiked to 20% and silver jewellery to 25% from existing 15% to boost local manufacturing. The move will be to protect the interest of small artisans and provide an incentive to the local manufacturers of jewellery.

Gold

import in December had declined to 39 tonnes from 151.58 tonnes in November. In January this year it was 36 tonnes.

Market sources said the reduction in duty would be owing to the efforts made by various associations including All India Gems & Jewellery Trade Federation (GJF), India Bullion and Jewellers Association Ltd. (IBJA), Federation of Indian Chambers of Commerce and Industry (FICCI) and The Gem & Jewellery Export Promotion Council (GJEPC).FICCI

“With so many associations taking up the issue, we believe the duty on gold will come down and this will create a good business environment,” said Kumar Jain, vice president, Mumbai Jewellers’ Association.

He said the reduction in duty will also improve the business. “The average number of 15 to 20 workers in small jewellery making units had gone down to three because there was no work owing to the rise in import duty, which led to fall in business. The workers are now returning with hope of change in business environment,” Jain said. He added that duty reduction will also help in curbing gold smuggling that has tremendously gone up in last two years.

Sources further said that government is also likely to set up special notified zones for gems and jewellery in the budget. They added that the setting up of notified zones will boost the manufacturing of gems and jewellery. The notified zones would also import and trade in rough diamonds.

MANISH PACHOULY