Union Budget 2023-24 Reaction by Shri Vipul Shah, Chairman, GJEPC

The Gem & Jewellery Export Promotion Council (GJEPC) applauds the pro-reform and export growth-oriented budget by Hon. Finance Minister Smt. Nirmala Sitharaman under the visionary leadership of Hon’ble Prime Minister Shri Narendra Modi. We would like to thank the Hon’ble Minister of Commerce & Industry Shri Piyush Goyal for the support and guidance that resulted in the recovery of exports especially post the pandemic.

In the first Budget of Amritkaal, Hon. Finance Minister has listed 7 priorities as she outlined people-centric agenda of ease of living and doing business to take on global challenges as well as for stimulating exports.

GJEPC thanks the Government for accepting its recommendation to promote indigenous manufacturing in the emerging Lab-Grown Diamond (LGD) sector by providing Research Grants to IIT for 5 years. GJEPC welcomes the reduction of Customs Duty on LGD seeds to zero from 5%. It will ensure India’s end-to-end world leadership in rough-to-finished lab-grown diamond and jewellery manufacturing.  In addition to that Govt. has also accepted to have clear segregation Customs (IT HS) codes for Silver and Platinum studded Lab grown jewellery for better differentiation and identification at the consumer level.

Another positive pro-growth move is that the conversion of physical gold into digital gold will not attract capital gains tax.

The increase in the allocation for the Interest Equalization Scheme from Rs. 2,376 crores in 2022-23 to Rs. 2,932 crores in 2023-24, up by 23%, will help in supporting exports, particularly by MSMEs and may result in increasing the subvention support as demanded by the exporters given rising interest rates.

The ₹13.7 lakh crore investment for infrastructure by the Government is a big positive step for the country. This will unleash the potential of the Indian Economy.

GJEPC welcomes the move to increase the duty on articles (jewellery) of precious metals such as gold/silver and platinum from 20% to 25% (+Nil AIDC +2 SWS). However, we are clarifying the import duty on findings which are raw materials in character for the manufacture of jewellery. Union Finance Minister has also rationalised the import duty on silver by proposing to increase the import duty on silver dore, bars and articles to align them with that on gold and platinum.  However, that will have a net effect of the increase of around 5% duty at the import level for silver increasing in price of silver products domestically.

The industry had recommended a Reduction in Import Duty on Gold/Silver and platinum which has not been considered in the Budget. The Council will continue to pursue the same with the Government for the overall welfare of the industry.

The enhancement of the Income Tax limit to Rs. 7 lakhs will benefit workers in the gem & jewellery industry. Reduction in surcharge in the highest Income Tax slab will reduce the maximum tax rate to 39% (from 42.74%) will benefit jewellers.

We hope PM Vishwa Karma Kaushal Samman’s package of assistance for traditional artisans and craftspeople will be extended to the 5,000-year-old indigenous gem & jewellery industry.

We appreciate the emphasis on exports, which are a key growth magnet in the growth of the economy. GJEPC welcomes the revamped Credit guarantee scheme for MSMEs and the Government’s assurance of returning 95 per cent of the forfeited amount to the enterprises in event of contract failure during covid-19 by MSMEs.

The Government’s Union Budget for FY24 reflects its long-term vision to spur the country’s march as a leading global economy to India@100.

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