In a move that brings relief to the jewelry export industry, the Indian government has revised wastage norms for gold, silver, and platinum jewelry, effective January 1, 2025. This update follows industry concerns over the earlier wastage limits introduced in May 2024, which significantly reduced allowable wastage percentages. The Directorate General of Foreign Trade (DGFT) issued a public notice detailing these changes, which aim to strike a balance between regulatory standards and the realities of jewelry manufacturing.
Earlier in May, the government reduced the wastage allowances for jewelry exports to help control the use of duty-free imported metals, reducing allowable wastage for plain gold and platinum jewelry from 2.5% to 0.5% and for silver from 3.2% to 0.75%. However, the jewelry industry expressed concerns, noting that these restrictions made compliance difficult and could impact production efficiency. In response, the Ministry of Commerce postponed the implementation until December 2024, giving time for a comprehensive review and revision of the norms.
Under the revised norms, wastage limits have been adjusted based on the type of jewelry and manufacturing method. For handcrafted jewelry, wastage limits have been raised to 2.25% for gold and platinum and 3% for silver. Machine-made gold and platinum jewelry will now allow 0.45% wastage, while silver will permit 0.5%. Handcrafted jewelry, which typically experiences higher wastage, will be allowed up to 4%, while machine-made studded jewelry can now have a wastage allowance of 2.8%.
These revised norms not only apply to jewelry but extend to idols, coins, medals, and other items made from these precious metals. To prevent misuse, exports by weight must now closely align with the duty-free metals imported minus the permissible wastage incurred during manufacturing. These regulations help ensure that duty-free imports used for exports do not leak into the domestic market, maintaining the integrity of India’s duty-free import structure for the export sector.
The jewelry industry has welcomed this revision as it provides a more practical approach to wastage management, better reflecting the challenges of jewelry production. By addressing these concerns, the government has enabled jewelry exporters to comply with wastage norms more effectively, ensuring that India remains competitive in the global jewelry market.
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