Finally, there is some good news for the gems and jewellery industry – the custom duty on gold and silver is down to 6% from 15%, and that on platinum to 6.4% from 15.4%. Besides, safe harbour rates for foreign mining companies have been introduced, which is bound to attract more raw diamond imports, supporting the local diamond cutting and polishing industry, and further boosting the economy. Overall, jewellery is set to become cheaper.

Industry leaders have hailed the Budget in a unanimous voice. Here’s what the Who’s Who of the industry has to say.

Vipul Shah, Chairman, GJEPC

The reduction in customs duty on gold and silver to 6%, and platinum to 6.4% will help curb the parallel market for gold, leading to a more transparent and regulated trade environment. This reduction is expected to make these precious metals more accessible, boosting legal imports and benefiting the entire supply chain, from miners to retailers.

Previously, foreign mining companies were deterred from selling in India due to being classified as permanent establishments, which subjected them to complex tax regulations. The new Safe Harbor Rule simplifies these tax implications, allowing foreign mining firms to operate in India without the risk of being considered permanent entities. This change is anticipated to attract more foreign investment, and foster a more competitive market, enhancing the availability of rough diamonds for Indian buyers 

We welcome the equalization of duty across all segments, including online portals. Prior to this, the gem and jewelry industry faced prohibitive duties on online transactions, which pushed businesses to collaborate with foreign companies. The new equalization duty levels the playing field, enabling domestic companies to leverage online platforms effectively. This shift is expected to drive digital transformation within the industry, expanding market reach, and enhancing customer engagement through e-commerce.

Sachin Jain, World Gold Council, India

This budget has announced a slew of measures to boost the overall economic growth of India. For the gold industry, the reduction in basic customs duty on gold from 10% to 5% and Agriculture Infrastructure & Development Cess (AIDC) from 5% to 1% will boost the overall competitiveness of the domestic jewellery industry. It will effectively reduce the overall taxes on gold from around 18.5% (including GST) to 9%. It’s a massive step in the right direction, as it will reduce the incentives for smuggling of gold. It will create a level playing field for honest industry stakeholders. Gold prices will also correct locally, thereby giving a boost to retail gold demand – another incentive to the Indian gold industry.

Amit Pratihari, De Beers Forevermark

The gems and jewellery sector has made significant contributions to India’s GDP, and we appreciate the announcements made in the Union Budget for this sector. The proposed reduction in customs duties to 6% on gold and silver, and 6.5% on platinum will enhance sales by making these precious metals more affordable. The implementation of safe harbour rates for the diamond-cutting industry, for foreign mining companies selling rough diamonds in India, will stimulate growth, boost consumer spending, and increase global competitiveness. Furthermore, the reduction of TDS from 1% to 0.1% for e-commerce operators will substantially support the industry's expansion. These new measures will not only strengthen the valued investment of Indian households in diamonds, but also add to their emotional significance.

Shreyansh Kapoor, Kashi Jewellers, Kanpur

Overall, we are very happy with the Budget because the FM has reduced the import duty on gold and platinum. This is a big respite for the industry; we have been asking for this for a long time. The lowered duty of 6% will enable customers to buy both 22ct and 18ct gold jewellery at a lower price. Moreover, a major benefit of the duty cut is that it will curb the smuggling of gold. Now, the incentive to smuggle is very low, and it is unlikely that miscreants will want to smuggle gold into the country. 

The reduced prices of jewellery will give a boost to business, especially in view of the forthcoming festival season. Independence Day and Rakhsa Bandhan are round the corner, and then it will soon be Navratri season. The duty cut will help our industry tremendously by giving a leg-up to sales. We also hope that there will be no change in the GST slab. It should remain at 3% -- 1.5% Central and 1.5% state GST. 

Ratnesh Tambi, Tambi Jewels, Jaipur

The reduction of gold import duty from 15% to 6% in India is a significant development for the country's jewellery market. Lowering the duty is expected to make gold more affordable, thereby boosting demand for jewellery. Additionally, the reduced duty is likely to decrease the incentives for gold smuggling.

The bullion market anticipated a 5% reduction in gold import duty, but the Finance Minister announced a more substantial 9% cut. This commendable step by the government exceeds expectations, and is likely to have an even more positive impact on the jewellery market. The larger-than-expected reduction will further lower gold prices, stimulate demand, and significantly reduce gold smuggling, benefiting the entire economy.

Saurabh Gadgil, PNG Jewellers, Pune

 We are delighted to learn about the significant reduction in import duties for gold and silver to 6%, and platinum to 6.4%. This decision, which aligns with the industry's long-standing request, is expected to have a positive impact on the organization and growth of the industry. By lowering import duties, we anticipate an increase in gold consumption, and a moderation in gold prices, which have recently reached record highs. This move is beneficial not only for the industry, but also provides relief to consumers. It represents a substantial step towards enhancing industry transparency and curbing illegal smuggling activities. We wholeheartedly welcome this decision, and look forward to its positive effects on the industry and the market.

Mitesh Khimji, Khimji Jewellers, Bhubaneshwar

We express our sincere appreciation for the favourable decision made by the esteemed Prime Minister and the Finance Minister to reduce the import duty on gold and silver to 6%, and platinum to 6.4%. This advantageous move offers substantial relief to the gems and jewellery sector. It will further augment the industry's global competitiveness, and effectively eradicate the parallel grey market.

Pavan Mor, Pavan Mor Jewellers, Hyderabad

The Budget has given considerable relief to the industry. The steps taken by the FM will give a boost to jewellery sales. It will infuse a fresh wave of hope and enthusiasm in the industry. I am thankful to the FM for reducing the duty on gold, silver and platinum. It will benefit not just the gems and jewellery industry, but the economy as well. Black marketing/smuggling will also be eradicated to a great extent. I foresee a great future for our industry, and it would not be incorrect to say that the benfits extended to the gems and jewellery industry will also increase the GDP of the country.