Indian Bullion Gems and Jewellery Trade Federation (GJF) has requested the Government to roll back tariff in gold by four per cent and hold only "beyond excellent" gold necessary for making jewelry.
At an official statement released here today, the GJF was looking for reduction of import tariffs at least four per cent from the current 10 percent to leave 10 percent difference between the import duties for gold and silver jewelry finished capita, compared with the raw material with a view to deter lower quality jewelry foothold in India.
It also endeavored to implement the 80:20 rule just beyond 55 tonnes of gold it takes a month for jewelry making. Indian bullion traders needs around 650 tons of gold to make jewelry.
Gold can not itself be held liable for the current account deficit. Gold imports in dollar terms fell dramatically from $ 50 billion in 2011-12 level of $ 30 billions levels in 2013-14, the statement said.
Gold imports to Indian bullion traders in US dollar terms has been reduced by about 20 to 25 percent and the size of imported gold has also been reduced in equal measure, GJF chairman Haresh Soni said in the news.
Head of the Council of Economic Advisers government ex C Rangarajan had also said that India can withstand $ 30 billion the value of gold imports, Soni said.
"Over the past three years, the Gold Control Raj has threatened the livelihoods of hundreds of thousands of employees and small jewelers. Industry with direct manpower 25 lakh is the second biggest employer do after in the software industry," said director Ashok Minawala GJF.
As RBI continue to restrict gold, the Government is not only losing revenue but also to encourage a parallel economy, that is putting pressure on the rupee because over dollars are needed to ensure a supply of smuggled goods. By the cartel for regulated channels and unlawful gold suppliers safe small jewelers to get their provision without extensive premium 15-18 percent, putting small jewelers and employees out of business, said representatives of GJF.
In May, the RBI relieved certain restrictions on gold imports that prevailed last year to deal with a sharp rise in the current account deficit of the country. As part of that, the RBI allowed 'star commercial firms' private exporters of jewelry that had been prohibited from import gold from July 2013 to resumption of imports with immediate effect.
Review of past restrictions on gold loans, the RBI has been issued a new circular on Tuesday that facilitated the ceiling for loans sanctioned against the pledging of gold jewelry and ornaments. The Bank completed a review its policy on December 30, limit the amount of loans punishable under RS 1 lakh.
As RBI, "Banks, for their policy approved by the Board, may decide on the ceiling regarding the amount of loans so granted contrary to the pledge of gold jewelry and ornaments final nonfarm uses." The tenor of the loan may not exceed 12 months from the date of sanction.
Read more: Govt relaxed loan limits against the pledging of gold ornaments and jewellery
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