India to hike import duty on cut and polished diamonds by 150%.

The Indian Government may raise the import duty on cut and polished diamonds to 5% from the current 2%. The steep 150% hike in duty is aimed to protect the interests of domestic diamond manufacturing industry.

With reference to recent data published by the Gems & Jewellery Export Promotion Council (GJEPC), the country’s imports of cut and polished diamonds have almost doubled in the initial six-month period of the current fiscal year. The rise in imports has posed a huge threat to the domestic manufacturing industry, especially to the small-scale manufacturers.

The higher imports of cut and polished diamonds have damaged the cutting and polishing business in Surat-the diamond hub of the nation. The data released by Surat Diamond Association (SDA) indicates that almost 1,000 units have already shut down due to lack of profit, leaving several thousands of workers jobless. More small-scale manufacturers are on the verge of closure.

The government move is intended to shield millions of artisans in the country who solely depend on the labor-intensive industry for their livelihood. Further, the rise in import duty is also expected to provide a level-playing field for domestic gems and jewellery manufacturers.

According to industry sources, the government notification hiking the duty on cut and polished imports is expected to be released during the week.

Source : resourceinvestor.com