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Interim Budget 2019 Fails to Cheer Gems & Jewellery Sector

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Mumbai, February 1: Piyush Goyal presented the Interim Budget 2019-20 today at the Parliament. The Interim Budget failed to provide any relief to the gems and jewellery sector. There was no major announcement made specifically for the industry, who had their expectations high from the Budget.

Giving his reactions on the Budget, Pramod Agarwal, Chairman, Gem and Jewellery Export Promotion Council (GJEPC) said, “We understand that the Budget presented today was a vote on accounts budget is not a full budget. We welcome Government’s thrust on ensuring progress and prosperity through the Budget. The relief given in direct taxes to middle classes and farmers will be good for increasing jewellery demand in the country. Also we hope that with the capital infused in the banking sector and banks coming out of PCA will help in solving the shortage of working capital for our exporters. At the same time, we are disappointed that the demand for decrease in import duty of raw materials like gold, silver, c&p diamonds and coloured gemstones were not included in the Budget today. We hope that during the declaration of the full budget after elections, the gems and jewellery sector demands will be addressed.”

Echoing similar views, Anantha Padmanabhan, Chairman, All India Gem & Jewellery Domestic Counci (GJC) said, “The only good thing is that exemption has been lifted from 2.5 lakhs to Rs 5 lakhs. So all the people who are under the Rs 5 lakh category, we are positive that the tax savings will come to the jewellery industry.”

Some other benefits in the tax slab introduced are-standard deduction has been increased to Rs 50,000 from Rs 40,000. For workers in the unorganised sector, a pension scheme was launched called Pradhan Mantri Shram Yogi Mandhan, to provide assured monthly pension of Rs 3000 per month, with the contribution of Rs 100 per month.

Vaibhav Saraf, Director, Aisshpra Gems & Jewels commented, “The Budget brings with it Ache Din in my opinion. With farmers given INR.6000 per annum it will help them buy better raw material which will lead to a better yield which will obviously lead to a better disposable income for them. We cater to the agricultural market majorly and therefore it will impact on sales positively. Relief in income tax slab will also result in higher disposable income for individuals.”

Saurabh Gadgil, CMD, PNG Jewellers and Director, National Vice President, Indian Bullion and Jewellers Association said, “The Interim Budget FY 2019-20 seems to be in a progressive direction, it lends support and upliftment for the SMEs, MSMEs, agricultural sector and the taxpaying middle class. The relief in income tax and various other exemptions, favourable policies towards the SME and agricultural sector will have a directly proportional effect on the gems and jewellery industry. People will have disposable income, it will surely lead to retail growth. This budget also indicates that the ministry feels it is time to clean and organize the gems and jewellery industry by introducing a comprehensive gold policy to develop gold as an asset class, provisional guidelines are being made for Gold Spot exchange, Gold Deposit account, Gold Monetization Scheme, this will form a comprehensive Mines to Market gold policy in the coming months. We are hoping this budget will bring about the required confidence in the economy and benefit the industry in the long run.”

Along with the reduction in import duty on gold from 10 percent to 4 percent, GJEPC sought for a reduction in the import duty on cut and polished gemstones from 7.5 percent to its earlier level of 2.5 percent in the Interim Budget. Some of the other expectations of the industry were-improvement in banking finance for the industry, income tax relief for mining companies to easy financing for the industry, revival of EMI schemes for jewellers, Bullion Exchange for the industry, removal of IGST on goods for exhibitions and re-import, and others. This was the last Budget before the April-May Lok Sabha elections.

Courtesy: Retail Jeweller India News Service

(Retail Jeweller India will be hosting their 6th edition of Retail Jeweller India Forum on February 9, 2019, at Sofitel BKC, Mumbai.  Register yourself today to be part of the exciting knowledge-based event, which will have renowned speakers sharing their rich insights on this year’s theme ‘Innovate to Win’. For more information and to register, log in on to retailjewellerindiaforum.com).

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