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US becomes largest export market for Indian gold jewellery
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IANS | 19 Jan, 2023
The US has become India's largest export market for gold jewellery ahead
of the UAE, the World Gold Council (WGC) said in a report.
According
to WGC, the US became the largest market for Indian gold jewellery due
to additional tariffs on Chinese jewellery to the US, which made the
Indian exporters more competitive.
Secondly, the UAE's
implementation of a 5 per cent import duty in 2017 and 5 per cent Value
Added Tax (VAT) in 2018 have negatively impacted its competitiveness.
The
WGC said that under a Comprehensive Economic Partnership Agreement
(CEPA), introduced in May 2022, 90 per cent of Indian goods sent to the
UAE will be given duty-free access. As goods sold in the UAE are
re-exported, this has substantially increased India's gold jewellery
exports and will continue to do so.
With the Indian government
seeking to boost manufacturing and exports, jewellery exports are likely
to rise. Also, proposals to allow advance payments to overseas precious
metal suppliers and set up mega common facility centres (CFCs) in the
Santacruz Electronics Export Processing Zones (SEEPZ) in Mumbai and
Surat could stimulate sector growth if implemented, said WGC.
According
to the gold mining companies' lobby body, CFCs would encourage best
practice while state-of-the-art machinery would give small manufacturers
access to technology and resources. If these efforts are supported by
marketing communications around both quality and craftsmanship, the
future of India's gold jewellery market will be assured.
Though
India is the second largest market for gold in the world, the sector
faced regulatory changes and shifting consumer behaviour, WGC said.
"Looking
ahead, gold jewellery will face further challenges. Changing
demographics and the possibility that millennials will move away from
gold as other luxury items demand their attention cannot be ignored.
Against these headwinds, gold jewellery demand will likely profit from
strong economic growth and urbanisation, as incomes rise and the middle
class increases. As more people are lifted out of poverty, gold
jewellery demand will benefit," WGC said.
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Customs Exchange Rates |
Currency |
Import |
Export |
US Dollar
|
66.20
|
64.50 |
UK Pound
|
87.50
|
84.65 |
Euro
|
78.25
|
75.65 |
Japanese
Yen |
58.85 |
56.85 |
As on 13 Aug, 2022 |
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