GJEPC informs about new RBI norms on gold imports

The Gem and Jewellery Export Promotion Council (GJEPC) in its efforts to keep the industry abreast with the developments towards the gold regulations being undertaken by the government mentioned the revised scheme for import of gold in the country. RBI has now decided to rationalize the import of gold in any form/purity including import of gold coins/dore into the country, after a series of steps to curb the gold imports, and thus curb the country’s current account deficit. In the past few months, the Government of India raised import duties to 8 percent from just about 2 percent last year. Certain restrictions were imposed on the import of various forms of gold by nominated banks/nominated agencies/ premier or star trading houses which have been permitted to import gold for use in the domestic sector.

RBI’s Circular No. 15 dated 22nd July, 2013 mentions that the Nominated banks/ Nominated agencies will ensure that at least one fifth of every lot of import of gold (in any form/purity including import of gold coins/dore) is exclusively made available for the purpose of export. Such imports shall be linked to financing of exporters by the nominated agencies (i.e. average of last three years or any one year whichever is higher). They shall make available gold in any form for domestic use only to entities engaged in jewellery business/bullion dealers supplying gold to jewellers.

Also, the MoC&I has also instructed all the nominated agencies under them to ensure the continuous supply of precious metal gold to exporters, which has already been initiated by various agencies like MMTC, STC etc across the country. This follows the efforts taken by GJEPC post restriction on import of gold on consignment basis, to restore gold supply to the export community. GJEPC put forth the woes of the industry to senior officials of Department of Revenue, Department of Economic Affairs and RBI and asked to restore the supply of gold to export community. With this new move we expect the growth in export of gold jewellery which had shown decline by over 60 percent during the current financial year. The Council has also asked industry members to keep vigilance on the compliance of said RBI circular.