Supportive e-commerce policy for gem, jewelry to drive online purchases: GJEPC

New Delhi: Gem and jewelry exporters’ body GJEPC on Wednesday, July 8 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 behavior across geographies. With e-commerce gaining momentum, a massive rise is seen in online purchases, and the introduction of a supportive e-commerce policy for the gem and jewelry sector will drive online jewelry 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 jewelry 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 jewelry sector entities; sale of rough diamonds in India by miners to special notified zones (SNZs); clarification on equalization levy for B2B international diamond auctions; reduction in import duty on polished diamonds, and gold monetization 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 percent 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 percent 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 percent to 2.5 percent 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.