Union Budget 2023-2024 Reaction: Vipul Shah, Chairman, GJEPC

1 Feb 2023 , 04:51 PM

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 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 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 crore in 2022-23 to Rs. 2,932 crore 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 in view of rising interest rates.

The Rs 13.7 lakh crore investment for infrastructure by the Government is a big positive step for the country. This will unleash the potential of 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 on the import duty on findings which are raw material in character for 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 increase of around 5% duty at import level for silver resulting in increase of price for silver products domestically.

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

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

We hope PM Vishwa Karma Kaushal Samman 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 growth of the economy. GJEPC welcomes the revamped Credit guarantee scheme for MSMEs and the Government’s assurance of returning 95 per cent of 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 all the way till India@100.