Chennai: Even as the domestic consumption of gold & jewellery grew in India, exports for the period of April to January stood at Rs 1.77 lakh crore, 9% lower than the same period last year.
With a decline of 60% gold medallions and coins saw the highest fall, followed by gold jewellery which saw a decline of 11%.
Exporters add that the demand in key markets including UAE, Hong Kong, US shrank.
“Besides, 5% tax has been recently imposed by Middle East countries. This would mean more pressure on sales,” said Pramod Agarwal, chairman, GJEPC.
Jewellers say that the reasons are owing to high import duty of 10% plus a 3% GST is pushing buyers to Dubai. "The market is soft and the duty by the Indian government is high. We must encourage NRIs to purchase more gold and sustain the exports," said Nitin Khandelwal, chairman, Gem and Jewellery Trade Federation. The industry has now sought support under the Merchandise Exports from India Scheme (MEIS) to boost the shipments and lower the import duty to improve the exports.
Goods and Services Tax refunds also affected exports. “Working capital gets stuck, which impacts export volume,” added Agarwal.
However, imports of rough diamonds and gold bars grew for the same period, registering a 13% increase.
Exporters and jewellers also add that with reduced credit from banks February and March could remain tepid. “While we are battling issues with, the council is exploring new markets in the Latin American & Commonwealth markets.
Source: timesofindia.indiatimes.com