Recently Pankaj Parekh, Regional Chairman – Eastern Region, Gem & Jewellery Export Promotion Council, said about, ‘Replacing the Duty Drawback Scheme with Remission of Rates and Taxes!’ He said, exporting gold jewellery made out of duty-paid gold and claiming duty drawback is not commercially viable, as the drawback duty rates are always lower than the rate paid while importing.
The rates of duty drawback are revised and fixed for a period of six months, which does not work well for a commodity like gold whose price is usually quite volatile. In addition, nominated agencies do not supply duty-free gold to small exporters who want to service overseas orders, which prevents newer players from entering this space.
Over a period of time, the GJEPC has seen a drop in the number of companies exporting gold jewellery under the Micro, Small and Medium Enterprises (MSME) category, which has impacted exports from Domestic Tariff Areas (DTAs). The loss suffered on account of an insufficient duty drawback is also very high. The present duty drawback does not recognise this peculiarity.
Marketing-related measures it is a well-accepted fact within the Indian industry that to secure a greater share of jewellery exports the need for sustained and vigorous marketing of Indian jewellery is paramount. Though the GJEPC is mandated to promote Indian jewellery overseas, its activities are centred on holding B2B exhibitions in India or overseas markets and inviting or sending trade delegations.
There is also a need to target consumers in overseas markets with better publicity through those avenues that are available today. Unfortunately, this is an extremely expensive proposition and the GJEPC alone cannot garner sufficient resources for B2C publicity. It is therefore recommended that the government should consider supporting the industry to facilitate B2C events.
Heera Zhaveraat (HZ International) A Diamond, Watch and Jewellery Trade Promotion Magazine provide dealers and manufactures with the key analytical information they need to succeed in the luxury industry. Pricing, availability and market information in the Magazine provides a critical edge.
