Without any significant growth in demand from any of the markets, gold jewellery exports from SEZ/EPZs have surged by 220 per cent between April and July, while that from DTA is down by 7 per cent. Import of gold bar too has recorded a huge leap of 450 per cent in July and 302 per cent between April and July.
Export of gold jewellery from Special Economic Zones (SEZs) and Export Promotion Zones (EPZs) went up by 220.7 per cent to touch Rs 23,012.51 crore between April and July this year against Rs 7,175.54 crore during the same period last year. Meanwhile, jewellery exports from Domestic Tariff Area (DTA) was down by 7.36 per cent to Rs 5,863.67 crore against Rs 6,329.53 crore in the corresponding period last year, as per the data from Gems and Jewellery Export Promotion Council (GJEPC).
“Dubai is the key market for gold jewellery from India. After the Dubai government introduced 5 per cent VAT on imports in 2017 and 5 per cent import duty in 2018, the trade has only gone down. Some of the re-exporters are back to business, but their imports have definitely not grown against last year,” said an industry insider. None of the other markets have reported any increase in demand either, he added.
According to him, there has been no development in favour of SEZ/EPZs in recent times that would lead to such a huge jump in exports against a decline in DTA. In fact, after 18.5 per cent MAT was imposed on SEZs, there is less enthusiasm among exporters to operate from export zones. Several companies, including jewellery exporters, have left SEZ/EPZs in recent times.
Between April and July last year, SEZ/EPZ exports were just 13 per cent more than DTA. However, during the same period this year, export zone shipments are 292 per cent higher than that from DTA.
Import of gold bar has shot up even more. Imports in July surged 450 per cent to Rs 5,246.54 crore against Rs 954.07 crore in July 2017. Between April and July, imports went up by 302 per cent to Rs 21,169.04 crore against Rs 5,266.80 crore in the same period last year.
However, GJEPC does not provide separate data on import of gold bars from SEZ/EPZs and DTA. Financial Chronicle did not receive response from GJEPC on the reason behind the unexplainable surge in exports and imports.