Gem and jewellery exporters' body GJEPC on Wednesday said the introduction of a supportive e-commerce policy by the government for the sector will help boost online purchases.
The formulation of a national e-commerce policy is under process in the commerce and industry ministry. A draft policy is expected to be released soon to seek public and stakeholders' views.
"COVID-19 has led to a paradigm shift in consumer behaviour across geographies. With e-commerce gaining momentum, a massive rise is seen in online purchases, and introduction of a supportive e-commerce policy for the gem and jewellery sector will drive online jewellery purchases," Gem and Jewellery Export Promotion Council Chairman Colin Shah said in a statement.
He also urged the government for a dedicated system-driven fast track customs clearance of shipments for the gems and jewellery goods valued below USD 800.
These issues among others were raised by Shah during a video conference meeting with Finance Minister Nirmala Sitharaman on July 6.
The council has suggested for making MyKYCBank platform mandatory for all gems and jewellery sector entities; sale of rough diamonds in India by miners to special notified zones (SNZs); clarification on equalisation levy for B2B international diamond auctions; reduction in import duty on polished diamonds, and gold monetisation scheme.
"We need to take measures and bring in reforms that would strengthen the ease of doing business in the industry," Shah said.
On the proposal of direct sale of rough diamonds by miners in SNZs in India, he said that currently, rough diamonds are sent to SNZs by miners for viewing in the country, post which diamonds are shipped back to Dubai or Antwerp by SNZ.
"Sales are not permitted, and if they do, it comes under the Permanent Entities as per the IT Act, and attracts income tax on the sale. The same goods are then shipped back to India via offices in Dubai or Antwerp, thus increasing costs for the importer. As much as 60 per cent of the rough is routed through Antwerp or Dubai," he added.
On availability of bank finance to the trade, GJEPC Vice-Chairman Vipul Shah said the industry has access to about Rs 66,580 crore of bank credit, which amounts to 0.68 per cent of the total bank credit of Rs 98,91,788 crore, which is "minuscule".
He said banks should follow all RBI circulars and notifications, and banks should be directed not to withdraw credit limits.
The council has also urged to reduce polished diamond import duty from 7.5 per cent to 2.5 per cent to help India strengthen its status as a polished diamond hub, as all distribution would then be out of India, leading to an increase in duty collection due to greater volumes, Shah added.
