Govt announces major step towards making India gems

New Delhi, Apr 10 (UNI) As a first major step towards making India a global trading hub the government today constituted an Expert Committee for looking into the entire fiscal issues affecting the gems and jewellery sector.

The Committee, headed by the former Revenue Secretary,M.R.

Sivaraman, includes members who are experts from various fields and have vast experience.

The Committee has been mandated to take up analysis of legislative provisions, rules and regulations governing taxation in the gem and jewellery industry in countries which have substantial turnover in the sector and also make recommendations for a taxation system based on best international practices in order to provide impetus to the growth of this sector.

The Committee is expected to submit its report by September 30, 2006. The initiative was proposed by Finance Minister P Chidambaram in his Budget for 2006-07.

The Commerce and Industry Ministry also announced a major boost for the gems and jewellery sector in the Foreign Trade Policy on April seven.

The policy allowed exporters to import precious metal scrap for export and also reduced the value-addition norm for importing gold and silver for re-export to 4.5 per cent from 7 per cent.

''Because of a rich tradition of craftsmanship, enterprise and availability of skilled, low cost manpower, India has the potential to become an international hub for gems and jewellery,'' Commerce and Industry Minister Kamal Nath had said. He said the diamond trade, which was concentrated in Antwerp was moving out - to Dubai, to Tel Aviv. I want Mumbai be right up there, and not lose out to its fellow Asian cities,'' he added.

Exporters have also been allowed to re-import the rejected precious metal jewellery subject to refund of duty exemption benefits on the inputs only, and not the duty on jewellery as was being done earlier.

Exporters often faced the dilemma of unsold jewellery in the foreign markets because of changing designs and other such factors.

Gems and Jewellery exporters have also been allowed to export such items for treatment and subsequent re-import, within a period of 120 days.

UNI YJ/PC CS ND1444