CBIC circular allowing export through courier huge relief to jewellery industry

retail
By retail January 13, 2021 14:43

CBIC circular allowing export through courier huge relief to jewellery industry

The recent announcement of the Central Board of Indirect Taxes and Customs, allowing export of jewellery using courier services, is all set to give a fillip to the gems and jewellery sector.

Manoj Chakraborty

In a big development, the Central Board of Indirect Taxes and Customs (CBIC)issued a circular on November 27 2020, clarifying that extant regulations do not restrict the export of gems and jewellery through the courier mode, and that such restrictions apply only to imports.This declaration is going to provide a huge relief to gems and jewellery exporters, who can now send their products across the globe, using the convenience of courier services.

The industry has been raising the issue of lack of clarity in rules regarding shipping jewellery overseas, and now it can heave a sigh of relief.Jewellers were not clear about the use of courier services for exports as Regulation 2(2)(a)(iv) of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010, places a restriction on imports of precious and semi-precious stones, gold, or silver, in any form whatever, through courier.

GJEPC steps in to get clarification

Taking up the cause of the industry, the Gems and Jewellery Export Promotion Council (GJEPC) made representations to the CBIC, seeking clarification on whether gems and jewellery are allowed to be exported through courier under the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010, as also the Courier Imports and Exports (Clearance) Regulations, 1998.

The Board then clarified that the Regulation 2(2) (a) (iv) reads as, “These regulations shall not apply to the following imported goods requiring testing of samples thereof or reference to the relevant statutory authorities or experts before their clearance, namely precious and semi-precious stones, gold or silver in any form.”

“Thus, the restriction imposed by Regulation 2(2)(a)(iv) on gems and jewellery is applicable only on their imports,” CBIC said, adding, ”The Courier Imports and Exports (Clearance) Regulations, 1998, place a restriction on imports of precious and semi-precious stones, gold or silver in any form, but not on their exports.”

CBIC thus made it clear that the extant Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010, and the Courier Imports and Exports (Clearance) Regulations, 1998, do not restrict exports of gems and jewellery through the courier mode. “The above clarification has to be read along with the other provisions applicable for exports through courier, such as those under Regulation 2(2) (b) and 2 (2) (c), of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010 and under regulation 2 (2) of the Courier Imports and Exports (Clearance) Regulations, 1998, while allowing such exports. All extant provisions for export of gems and jewellery under any other law for the time being in force will also apply,” the circular said.

DHL and BVC to help SME jewellers reach global markets

Interestingly, the CBIC announcement comes just months after DHL Express, the world’s leading international express service provider, and BVC, India’s largest secure logistics enterprise,  entered into a partnership in March this year to enable Indian SMEs grow their presence in the international marketplace. This service is targeted at 10,000 Indian jewellery SME exporters for B2C shipments.

At present, India’s exports of gems and jewellery are predominantly focused towards the United States, UAE and Hong Kong, and account for 80% of all shipments. However, jewellery exporters now have an opportunity to grow in markets such as Russia, Brazil, Vietnam, Singapore, France and Italy.

The DHL-BVC partnership will enable SME jewellery exporters/importers to take advantage of growing cross-border business opportunities in the finished goods space. They will benefit from a wide range of logistics offerings, such as lower shipping prices, 360-degree shipping solutions, unique value-added offerings, such as breakbulk, consolidated returns, slot-based deliveries, and other offerings that are likely to create a hassle-free experience for both shippers and buyers. The partnership, at present, primarily covers B2C players who seek to leverage the increasing demand from international customers.

The jewellery industry, thus, has an opportunity to exploit the twin benefits of the DHL-BVC partnership and the recent government announcement allowing the use of courier services for the export of jewellery.

Existing exportscenario

Presently, export of gems and jewellery is mainly done through B2B trade. If gems and jewellery exports are promoted through e-commerce, and aimed directly at end users, it will result in higher value addition, and become cost-effective for exporters.

As of now, the United States, which levies zero custom duty on consignment value below $800, is one of the major markets for Indian jewellery.But e-commerce exports will present new opportunities to the industry.

Take the case of China. It has understood the importance of e-commerce as a medium to connect with global customers. Unfortunately, the Indian gems and jewellery industry has not been able to benefit fromthe e-commerce boom due to various policy-related hurdles.Now, with the recent government announcement, the industry has an opportunity to catch up with China and make inroads in newer markets.

Even as the recent circular is all set to iron out some glitches, there is a need for bringing various government bodies and e-commerce companies on the same platform. On its part, the industry needs to ensure that all transactions are traceable, with end-to-end tracking, and follow all rules and regulations.

 

Courtesy: As published in The Retail Jeweller India Tabloid

 

retail
By retail January 13, 2021 14:43
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