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India Cracks Down on Rough Shipments
May 26, 2019 9:42 AM
By Joshua Freedman
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RAPAPORT... India’s diamond trade is in a fight with authorities over
stricter customs enforcement for rough that could have a “disastrous” impact on the
industry.
Companies have recently been suspected of giving incorrect values for imports or exports of rough diamonds, a senior official at the Office of the Commissioner of Customs in Mumbai reported in a note on May 4. In most of those cases, the customs documents only referred to the shipments as “rough diamonds,” the note continued.
From now on, importers and exporters must give detailed descriptions of the stones, including the origin, size, shape (e.g. octahedron, triangle), type (e.g. sawable, makeable), color and clarity, it ordered.
India is the world’s largest importer of rough diamonds, with shipments of $16.87 billion in 2018, according to Rapaport calculations based on data from the Gem & Jewellery Export Promotion Council (GJEPC). The authorities’ approach could threaten that trade by delaying shipments and creating uncertainty among rough importers, the GJEPC claimed in a response to the note last week.
“It
is very likely that major diamond [companies] would shy away from making further
exports to India, as the regulatory onus placed on them by the Indian customs
authorities is impossible to meet,” the GJEPC continued.
The procedures are also unworkable, as there is a huge range of rough-diamond types and no agreed classification standard, the council added. Trade members have complied, but their descriptions have shown inevitable inconsistency, it reported, urging the government to reverse the decision. The rules add to the
existing burden of a 0.25% goods and services tax on rough, which went into effect in
2017, it pointed out.
Image: Rough diamonds. (De Beers)
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Tags:
GJEPC, India, Joshua Freedman, Rapaport News, rough, Rough Diamonds
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