In February 2017, by 47% The Gold jewellery exports from India have fallen due to the jewellery routed through UAE is badly impacted.
The two major factors impacting the gold export from India is UAE w.e.f from January 1st, 2017 imposes 5% import duty on jewellery and The Indian government has a 10% import duty on gold imported for making jewellery.
In January Indian Gold jewellery exports fell by 24% and in February further by 47.52% and India’s market share has been gained by competitors like China. By Indians exporters and jewelry manufacturers, to avoid 5% import levy many manufacturing units are being set up in UAE. For, the same the gold artisans are moving to UAE and about 20% of Indian jewellery business might move to UAE.
The import duty on gold the Indian government should cut, expected by the government and stop the fall in Gold jewellery exports make it below 5%. As per a data made by Gems and Jewellery Export Promotion Council (GJEPC), which shows that in February 2017, gold jewellery exports fell to Rs 2,810.60 crore from Rs 5,355.47 crore in comparison to February 2016.
If this situation continues, to UAE, Indian exporters will be forced to either look at other markets and routes or think about moving facilities. The industry has been impacted badly due to the latest move of 1% excise duty and other supply restriction.