India’s Jewellery Industry Is Witnessing Recession, Job Losses Likely, Says Industry Body
India’s jewellery industry is witnessing a "recession" and skilled artisans are staring at the prospect of job losses, the All India Gem and Jewellery Domestic Council said on Monday, seeking lower gold import duty and a cut in Goods and Services Tax on jewellery.
In Union Budget 2019-20, gold import duty was raised to 12.50 percent to 10 percent while GST on jewellery was fixed at 3 percent as compared to 1 percent under the previous tax regime.
"The jewellery industry is passing through a recession due to low demand. Thousands of skilled artisans are staring at the prospects of losing jobs," said Shaankar Sen, vice chairman of the All India Gems & Jewellery Council.
The hike in gold import duty and GST on jewellery is affecting customer sentiment, as prices have increased. "We demand the customs duty be lowered from 12.5 percent to 10 percent, and the GST rate be fixed at 1 percent," said Sen.
The high import duty is also leading to gold smuggling, he added.
Among other recommendations, Sen said the council has urged the government to introduce EMI schemes for jewellery purchases, since gold has been declared as an asset class, and that the requirement for production of PAN card on such purchases should be raised from Rs 2 lakh to Rs 5 lakh.