KOLKATA: The gold trade in the country is facing a double whammy of increased competition due to duty free jewellery imports from Indonesia and an anticipated fall in rural demand from June 1 when submission of PAN becomes mandatory for buying jewellery worth over Rs 1 lakh.
Trade insiders say gold jewellery imported from Indonesia under the free trade agreement (FTA) are is hurting the domestic business that has to pay an import duty for gold. “Gold, the raw material for jewellery, attracts an import duty of 10%, which makes the landed price of gold costlier. And automatically our jewellery prices go up,” said Manish Jain, chairman at Gem & Jewellery Trade Federation (GJF).
“We have brought this to the notice of the commerce ministry,” he said. Pankaj Parekh, vice-chairman at Gem & Jewellery Export Promotion Council, too, said jewellery imports from Indonesia are “completely detrimental to the interest of the gold trade”.
The development comes at a time when the domestic demand is not picking up. Jewellers fear the market condition may get worse as buyers will soon have to show their permanent account number (PAN) card issued by the income tax department if they purchase jewellery for more than Rs 1 lakh.
