India's Gold Jewellery Sector Highly Disappointed with Union Budget

SEATTLE (Scrap Monster): The gems and gold jewellery sector in India is reportedly extremely disappointed with the recent Union Budget presented by the Finance Minister. As per industry sources, the government has not responded to any of the demands made by the industry over the past several months.

The industry has been hoping for reduction in import duty on gold from 12.5% to 4% in the budget. However, the government has left the import duty structure as well as the GST rate of 3% unchanged. Also, there were hopes that the limit for gold purchases without PAN card would be raised from Rs 2 lakhs to Rs. 5 lakhs. Bablu Dey, working president Swarna Shilpa Bachao Committee noted that the total duty of 15.5% has made gold in India the costliest in the world. This has led to expansion of grey market and tremendous hike in smuggling acts, he said.

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The government’s decision is feared to present several challenges to domestic gold jewellery sector in the country. A large number of artisans, mostly migrant workers, are likely to lose their job.

As per rough estimates, the gems and jewellery sector accounts for 7% of the country’s Gross Domestic Product (GDP).