The delay in clearing the gold procurement requests by the Directorate General of Foreign Trade (DGFT) has led to supply crunch in India. As per reports, nominated agencies too were seen delaying supply to bulk consumers thus heightening the fall in gold supply to jewellery exporters.
The Reserve Bank of India (RBI) had come up with 80:20 rule in August last year which linked exports to gold imports, making it mandatory for gold importers to supply at least 20% of their imports to exporters. However, despite providing proofs for jewellery exports, authorities have been shelving the requests of jewellery manufacturers for several weeks, said Pankaj Parekh, Vice-Chairman, Gems and Jewellery Export Promotion Council (GJEPC).
According to GJEPC, the non-availability of raw material has badly hit the fabrication industry in the country.
The Gems and Jewellery Export Promotion Council (GJEPC) had highlighted the absence of replenishment scheme on the earlier circular issued by the RBI. It also had submitted the details of gold procured by the Council members under replenishment scheme. Under these circumstances, the RBI has issued a revised circular to include replenishment scheme under 80:20 guidelines. This has come as a huge sigh of relief to exporters. By way of replenishment scheme, the re-sale gold procured from customers can be utilized for exports.
The nominated agencies expect shocker decision from the government to cut high gold import duties, which defers them from supplying gold to bulk consumers.