GJEPC: India's gem and gold jewellery exports to soar 10% in FY17

NEW DELHI (Scrap Monster): The Gem & Jewellery Export Promotion Council (GJEPC) predicts 10% growth to India’s gem and jewellery exports during the current fiscal. According to GJEPC, the jump in exports will be mainly triggered by rising demand from the US and European markets. The exports of polished diamonds are likely to grow the most during the fiscal FY17. Incidentally, cut and polished diamond export by the country jumped higher by 23% year-on-year to total US $1.48 billion during the month of December 2016.

Praveen Shankar Pandya, Chairman, GJEPC noted that all eyes are now on US President Donald Trump and the various measures that are expected to be announced to revive the American economy. As announced during the campaign, a string of policy actions are expected from the new US administration, primarily aimed at boosting US economy. Any improvement in US economy will create new jobs, which in turn will result in increased demand for jewellery. The US is presently a big market for Indian exports. The anticipated US economic recovery will make the market even bigger for Indian gems and jewellery exporters, Pandya noted. The expected repeal of the NAFTA trade agreement may also do well for Indian exports, he added.

The European markets too have shown early signs of demand growth. However, the parity between US Dollar and Euro have made things more competitive there, Pandya noted. In addition to strengthening market presence in the US and Europe, the apex trade body has taken necessary steps to explore new markets to boost its export revenues. GJEPC has identified Korea and the Commonwealth of Independent States (CIS) region as two markets with immense potential for exports. Alongside, it will also focus on increasing the exports to markets such as Japan and the Middle East, noted Pandya.

Meantime, GJEPC have reacted positively to the Union Budget presented by the country’s Finance Minister of Feb 1^st. However, the trade body noted that the budget failed to address certain long-pending demands put forward by them. The Micro, Small and Medium Enterprises (MSMEs) may benefit by the proposed low corporate tax rate. Also, the severe shortage of skilled workers in the sector could be solved to some extent by setting up of skill development and training centres under the Skill India programme. Apart from these, the budget did not have anything to offer for the gems and jewellery sector, said Pandya.

The government has not listened to repeated requests by the industry to lower the gold import duty from existing 10%. According to GJEPC, the high import duty will result in increased smuggling of the yellow metal. The government could have curbed grey market transactions of gold by lowering the import duty on gold to at least 5%. Also, the budget has not increased the PAN card limit on gold purchase transactions from 2 lakhs to 5 lakhs, as demanded by the industry. The relaxation in PAN Card limit would have boosted domestic gold demand in the country.

About GJEPC

The GJEPC, set up by the by the Ministry of Commerce, Government of India in 1966 is the apex body of the gems & jewellery industry. Headquartered in Mumbai, the industry body represents almost 6,000 exporters in the sector.