GJEPC Appeals to Government for Concessions

Alarmed by the reduction in exports, production and revenue as well as with hundreds of thousands jobs at stake, the Gem & Jewellery Export Promotion Council (GJEPC) has appealed to the Government of India for various concessions to help it ride out this period of recession and financial turmoil.

“Overall exports of gems and jewelry are down by 34.25 percent in November, GJEPC Chairman Vasant Mehta said at a press conference Tuesday. “At the manufacturing level, exports of cut and polished diamonds are down by 20.18 percent for November as compared to last year; and there has been a 20 percent reduction in orders for the period April to October 2008.”

December seems to be following the same trend, and expected to be much worse. The situation looked grim, he said, and the specter of severe job losses loomed large.

In the April to October period, 65,000 manufacturing workers lost their jobs.

The GJEPC has identified two major problem areas which need immediate solutions: issues related to the consistent supply and distribution of gold; and financing issues, including inadequacy of dollar financing and high interest rates on it.

The relief measures sought by the GJEPC are:

·        Status holders be allowed to import gold directly and sell to exporters.

·        Adequate dollar credit lines by Reserve Bank of India (RBI) be made available

·        Release of dollars from government’s reserves so that they are available credit lines to tide over the current crisis

·        Banks to be asked to continue giving credit on the limits sanctioned to individual exporters on absolute dollar terms rather than on fluctuating exchange rates

·        Discontinuation of the current practice of declaring exporter’s account as an NPA due to delayed collections, which brings down the exporter’s rating

·        Grant of Duty Credit Scrip equivalent to 2.5 percent of FOB value of previous year’s exports to all countries

·        Increase of recently announced measure of subvention of rupee interest from 2 percent to 4 percent.

Sanjay Kothari, past chairman and current convenor of the Promotions, Marketing & Business Development Committee, stressed that the Council was keeping up its activity which included delegations to explore trade opportunities in several countries, the IIJS Signature which will be held in February and the Mines to Market Conference to be held in the first part of 2009.