The Indian government reduced import duties on gold and silver in a move that industry stakeholders say will bolster the country’s jewellery and gemstone exports.

Import taxes on gold and silver now stand at 7.5 per cent from 12.5 per cent while duties on platinum and palladium were cut to 10 per cent, Finance Minister Nirmala Sitharaman announced on February 1.

Colin Shah, chairman of the Gem & Jewellery Export Promotion Council (GJEPC), commented that these will make India’s gem and jewellery exports more globally competitive.

He said previously higher duties affected India’s export competitiveness, forcing Indian companies to source goods in Dubai, Hong Kong or other centres. “Along with this, the decrease in import duties on jewellery findings to 10 per cent will help jewellery exporters in a big way,” continued Shah.

The government likewise clarified that a 2 per cent equalisation levy on digital transactions do not apply to B2B purchases of rough diamonds through online auctions – a move that will help Indian diamond manufacturers buy directly from the mines, explained the GJEPC official.

The group also lauded the government’s decision to set up a new gold exchange regulated by the Securities and Exchange Board of India or Sebi as this could improve sales and marketability of gold.