Union Budget 2019-20 | Kashmir jewellers demand rollback of import duty hike on gold

The imposition of 2.5 percent additional import duty on the gold announced in the Union Budget on Friday has evoked strong criticism from jewellers in Kashmir, who says the move will bring slump in the sales of yellow metal during the ongoing marriage season.

Jewellers, who are worried due to gold market going througha slump due to volatility in prices, have demanded immediate roll back of theduty hike.

   

Union Finance Minister Nirmala Sitharaman in her maidenbudget speech on Friday proposed to increase custom duty on gold and otherprecious metals from 10 percent to 12.5 percent.

However, local jewellers who after 1 percent excise dutyhike in 2016 Union Budget had followed an All-India strike for more than a weeksay they will follow “whatever programme is announced by national levelumbrella body of the jewellers against the duty hike”. 

Talking to Greater Kashmir, Bashir Ahmad Rather, presidentof All Kashmir Gold Dealers and Workers Association said the increase in importduty along with global reasons is pushing prices of gold up, adverselyaffecting the market.

“Gold prices have already been sky-rocketing due to severalreasons. The trends in global markets such as central banks hoarding the metalat fast rates, geo-political situation in Middle East, purchase of gold as anasset class for investments also continue to push gold prices up,” Rather said.

Rather said All India Gems and Jewellery Association hasalso opposed the hike in duty adding that “it is a draconian move to finish thejewellery industry once for all”. Interestingly, the custom duty which wasincreased by the central government in 2016 Union Budget had also witnessedprices of the yellow metal jump abruptly resulting in gold market slowdown forseveral months across the country.

Bahauddin Zargar, president, Kashmir Gold JewellersAssociation (Anjumani-Zargaraan), which has a large number of members from goldmarket hub of Saraf Kadal in Downtown, Srinagar, said apart from goldsmiths,thousands of workers who do polishing of ornaments and gold units in Srinagarand other districts of the Valley will also be hit by the import duty hike assales which already have been abysmal will be further hit.

“Bulk of the population in Kashmir is busy with the marriageseason and has been making purchase queries with us. We will lose a largeclientele in case the duty increase is not rolled back as anyways Gold marketis down,” Zargar said.

Meanwhile, prospective Gold buyers say they will hold backtheir decision of purchasing the Yellow metal for the time being till pricesstabilise. “My sister’s wedding is scheduled for October and we had to purchasesome ornaments in addition to what we have shopped for. But now we will waitand watch the market trends before making bulk buying of Gold,” said a customerShazia.

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