Jewellery exporters in Rajasthan have been facing difficulties in getting duty-free gold that they used to buy from MMTC. According to industry, MMTC has stopped selling gold to jewellers.

Gold is imported by nominated agencies and banks approved by RBI. Since exporters don’t pay duty, they used to buy from MMTC. But since MMTC has stopped selling gold, now exporters are forced to buy from banks and pay 7.5 basic customs duty and GST of 3%.
Nirmal Bardiya, regional chairman, Rajasthan, Gold and Jewellery Exports Promotion Council, said, “We have no access to duty-free gold now. MMTC is not selling. The manufacturers are facing difficulties. We want the Centre to immediate direct MMTC to sell duty free gold.”

Bardiya said if they buy from banks, they have to pay 7.5% basic customs duty and GST at 3%. “The international market is very competitive. We cannot absorb the cost. Our products cannot compete with sells from other countries. Exports and employment in the sector are bound to suffer if the government does not take quick measures to make gold available to exporters.

Exporters are exempted from duty. Even if the duty is refunded as drawback, they won’t get back 100%. “Duty drawback is allowed up to 80%. And they would still lose 20% on duty which cannot be absorbed by the manufacturers,” said another representative of GJEPC.

Besides, MMTC, duty-free gold is sold by Diamond India Ltd, which caters to manufacturers in Mumbai region. Jewellers in Rajasthan were dependent on MMTC.

Courtesy : TOI