Wednesday, 2 November 2016

Govt tightens gold import norms for premium export houses

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The Director General of Foreign Trade has tightened norms for export houses to import gold in their capacities as nominated agencies. The public notice to this effect issued by the DGFT has said that for getting permission as a nominated agency for importing gold for domestic purpose, only exports from domestic tariff areas would be counted and such exports have much better vigilance mechanism.

At present apart from banks, MMTC and body like export promotion councils star and premium trading houses were allowed to import gold for domestic market. now import by star and premium trading houses will come down because the DGFT has said that for “the export performance of Gem and Jewellery items for Special economic zones and Export oriented units {SEZ/EOUs} will not be clubbed with export performance of Domestic tariff area (DTA) units for grant of nominated agency certificate.”

The public notice no. 37/2015-2020 dated 4 October was actually made available this week only.

A veteran trade analyst said that, “some leading export houses were allegedly incorrectly declaring gold jewellery exported from SEZ/EOUs to be of 22 carat jewellery while actually, they were exporting 18 carat jewellery thereby saving around 8 per cent of gold imported duty free in the name of exporting back and selling that gold in open market in India. Since DTA exports have tighter vigilance mechanism, such a practice will be arrested.”

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