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RAPAPORT... The Reserve Bank of India (RBI) stated that the "Clean Credit" or credit given by a foreign supplier to India-based buyers, without any letter of credit (suppliers) or letter of undertaking (buyers) or fixed deposits from any Indian financial institution for importing rough, cut and polished diamonds, may be permitted for a period not to exceed 180 days from the date of shipment. The previous requirement permitted a period not exceeding 90 days from the date of shipment. RBI issued the new guideline following consultation with the Gems & Jewellery Export Promotion Council (GJEPC) and the Surat Diamond Association. RBI reminded banks to conduct due diligence through "Know-Your-Customer" regulatory norms and to adhere to anti-money laundering standards while undertaking the import transactions. Furthermore, any large or abnormal increases in the volume of business should be closely examined to ensure that the transactions are legitimate, according to the central bank. All other instructions related to importing rough, cut and polished diamonds remain unchanged. Read more from the circular here.
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