The import of polished diamonds into India is likely to come down drastically following the doubling of duty on cut and polished diamonds from 2.5% to 5% by the Indian government, says a TOI report.
GJEPC authorities termed the government’s decision to increase import duty on cut and polished diamonds as a stumbling block in India’s chances of becoming an international diamond trading hub. The move, according to the GJEPC, will not provide a level-playing field vis-à-vis other peers such as Belgium, Dubai and Israel.
Moreover, it will have a negative impact on the ‘shut out’ business from the US, which has been growing fast.
Industry sources told TOI that the Americans sell the old diamond studded jewellery and that broken and other diamonds are imported by India. In India, the diamonds are recycled and exported once again. With 5% import duty on cut and polished diamonds, the cost of imported diamonds will increase phenomenally.
Talking to TOI, GJEPC’s regional chairman, Dinesh Navadiya reportedly said, “The council is continuously in touch with the finance ministry and other departments to revise the decision on increasing import duty on cut and polished diamonds. We had supported the central government’s decision on imposing 2.5% duty on diamonds to stop round tripping. In past few years, the round tripping has completely stopped and diamonds imported in the country are of the jewellery sold by the Americans.”