Union Budget 2024 Expectations: Gold Industry And Electronics Sector Seek Key Reforms

As the Union Budget 2024 approaches, key industry players are voicing their expectations and hopes for significant reforms that could shape the future of India's gold and electronics sectors.

What Does the Gold Industry Want from Budget 2024?

Sachin Kothari, Director of Augmont - Gold For All, has highlighted several crucial areas where the gold industry seeks changes:

1. Import Duty Adjustments: The gold sector is calling for a reduction in the import duty on gold from 15% to 10%. They also advocate for silver import duties to be aligned with those of gold under the Comprehensive Economic Partnership Agreement (CEPA). Additionally, there is a push to end duty-free imports of gold dore from Least Developed Countries (LDCs) and Free Trade Agreement (FTA) countries, as these benefits create an uneven playing field, as reported by Hindustan Times.

2. Bullion Trading Enhancements: With the International Bullion Exchange (IIBX) at GIFT City emerging as a pivotal hub for bullion trade, industry players are urging that all gold imports and exports be conducted through IIBX. They propose a special benefit of 0.5% for gold imports and support the establishment of a Jewellery Export Center at GIFT City to assist domestic smaller traders.

3. Regulatory Streamlining: The gold market currently faces regulation from multiple bodies, including SEBI, RBI, DGFT, the Ministry of Finance, and the Ministry of Commerce. Market participants are advocating for a single regulatory body to oversee the sector and the migration of 100% of bullion trade to commodity exchanges.

4. Taxation and Bond Reforms: Sovereign Gold Bonds (SGBs) have gained popularity, yet the interest earned on these bonds is taxable if redeemed before eight years, as reported by Hindustan Times. The industry is requesting that this interest income be made tax-free to attract more investors. Additionally, they are calling for the creation of GST-bonded warehouses, mandatory hallmarking for all jewellers, the introduction of EMI options for jewellery purchases, and the facilitation of lending and borrowing through commodity exchanges.

Will the Budget 2024 Support Electronics Exports Like Televisions?

In the electronics sector, Sharan Maini, Director of Veira Group, has outlined expectations for the Union Budget 2024:

1. Export-Driven Strategy: Maini emphasizes the need for policies that support an export-driven approach, particularly in television exports. He advocates for a focus on enhancing domestic production capabilities and empowering Indian manufacturers.

2. Supply Chain Optimization: Streamlining supply chains and localizing components are viewed as essential steps to reduce dependency on foreign suppliers and strengthen the local manufacturing ecosystem. This, in turn, is expected to create jobs and boost foreign reserves, as reported by Hindustan Times.

3. Supportive Environment: To position India as a significant player in global electronics manufacturing, Maini calls for a supportive environment that fosters innovation and simplifies business operations. This would not only enhance India's standing in the international electronics market but also support both domestic and export markets, as per media reports.

As the budget announcement approaches, the anticipation is high among these sectors, with hopes pinned on impactful reforms that could drive growth and competitiveness in India's dynamic economy.