US President-elect Joe Biden urged to bring jewellery exports from India under GSP

Kolkata: Indian gem and jewellery exporters want the US President-elect Joe Biden to bring jewellery exports from India to the US under GSP (generalised system of preferences) to give India a competitive edge over China.

“The council will once again raise the issue of India’s inclusion in GSP for gems and jewellery so that we can have a competitive edge over our Chinese counterparts,” said Colin Shah, chairman, Gem & Jewellery Export Promotion Council (GJEPC).

Under President Donald Trump, the US had withdrawn its preferential treatment to Indian exports under the GSP granted to India and some other developing countries in 1976 that allowed some Indian exports to get duty-free access into the US, allowing Indian exporters to export more and develop faster. The withdrawal of GSP became effective from June 5, 2019.

An optimistic Shah said Biden has been a vice president under Obama for 8 years and has been a friend and supporter of India during that period and he expects his stance towards India to reflect in economic and trade policies.

“We hope that there will be another economic stimulus and higher infrastructure spends which will boost the GDP of the US and in turn will boost consumption of gems and jewellery,” Shah said.

GSP benefit was withdrawn on exports of 45 gem and jewellery commodities from India valued $86.54 million. Crisil had observed that the withdrawal of GSP will affect exporters of gems & jewellery the most because 15% of such exports availed of its benefits in calendar 2018.

“Now there will be an additional duty of 7% on exports of precious metal-based and imitation jewellery. That will reduce competitiveness of domestic exporters and put pressure on margins,” the rating agency said last year immediately after the GSP was withdrawn.

The 45 items on which GSP has been withdrawn include precious stones (other than diamonds) and semiprecious stones, silver unwrought (other than bullion and dore), gold (including gold plated with platinum) in semi-manufactured forms (except gold leaves) among others.

Indian gem and jewellery exports suffered when the US withdrew GSP in 2007, 2008 and 2009, and thereby started attracting the most favoured nation (MFN) rate of around 5-6 per cent at the USA customs territories. The products from which GSP was withdrawn were silver articles of jewellery and parts, gold rope necklaces and neck chains, gold mixed link necklaces and neck chains among others.

According to GJEPC statistics, the gem and jewellery exports from India in the first half of the current fiscal stood at Rs 51,897.73 crore from Rs 1,06,871.37 crore in H1 of 2020, a drop of 37 per cent.

US President-elect Joe Biden urged to bring jewellery exports from India under GSP US President-elect Joe Biden urged to bring jewellery exports from India under GSP Reviewed by TechCO on 11/13/2020 Rating: 5

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