Leaders within India’s jewelry industry have requested the removal of import duty on crucial materials used for the manufacturing of lab-created diamonds.
As part of the chemical vapor deposition (CVD) method for producing lab-created diamonds, a sliver of rough known as the ‘seed’ is placed in a sealed chamber and heated to a high temperature, rapidly mimicking the natural process within which diamonds are created.
Importers pay 5 percent tax on the import of these seeds whereas no import duty is charged on natural or lab-created diamond rough.
Gem and Jewelery Export Promotion Council (GJEPC) chairman Vipul Shah said that removing the import duty would significantly bolster India’s manufacturing sector.
,[The lower rate would] help in the growth of the lab-created diamond industry in India manifold and also help them in reverse engineering the technology in future,” he told Rapaport News.
India’s customs policy views seeds as ‘preforms’ – shaped but unfinished diamonds as opposed to rough lab-created diamonds.
The GJEPC has also requested the easing of import tax on polished diamonds from 5 per cent to 2.5 per cent.
According to the GJEPC, India accounts for approximately 15 percent of the global production of lab-created diamonds and Shah said demand from western markets, including Australia, was driving the development of the industry.
“We have a huge potential to grow exports to $US7-8 billion in the next few years on the back of US demand and acceptability in the UK and Australia,” he told To install Business Standard.
On 1 February the Indian government will complete the annual Union Budget, a review of taxation policy.
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