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  Business   In Other News  05 Nov 2019  Round-tripping finds new routes

Round-tripping finds new routes

THE ASIAN AGE. | SANGEETHA G
Published : Nov 5, 2019, 1:08 am IST
Updated : Nov 5, 2019, 1:08 am IST

Making most of the festive period, the exports of gold and silver articles have seen a sudden five-fold surge.

Till August this year, ‘articles made of gold, silver and other metals’ was not even a category big enough to be mentioned in the export data sheet of the Gems and Jewelery Export Promotion Council.
 Till August this year, ‘articles made of gold, silver and other metals’ was not even a category big enough to be mentioned in the export data sheet of the Gems and Jewelery Export Promotion Council.

Chennai: Round-tripping in gems and jewellery exports has found a new avenue— crude gold and silver articles. Making most of the festive period, the exports of gold and silver articles have seen a sudden five-fold surge.

Till August this year, ‘articles made of gold, silver and other metals’ was not even a category big enough to be mentioned in the export data sheet of the Gems and Jewelery Export Promotion Council. Between April and August last year, articles worth Rs 83 crore were exported. This year, for the same period, exports in this category went up to Rs 1,326 crore- a growth of 1,489 per cent.

The exports went further up in September—Rs 230 crore against Rs 34 crore in the same month last year and Rs 8.64 crore in August. During April-September, the exports were up 575 per cent to Rs 1,788 crore against Rs 118 crore in the same period last year.

“These are articles like plates, cutlery, small idols of Hindu gods and goddesses in silver and items like cufflinks and broaches in gold. Gold and silver account for 90 per cent of articles in this category. During the Diwali time, such articles are usually exported to markets like Dubai, Singapore and Hong Kong. But usually they are not very big in value terms,” said an industry expert.

“The sudden surge in the exports of such articles this year is not due to any increased demand. Such articles in their crude form have become a new avenue for some bogus exporters to do round-tripping in order to fulfill their export obligations,” he said.

Some exporters, who avail of export credit at a lower rate compared to domestic lending rates, are increasingly using crude gold and silver articles with minimal addition as a means to fulfil their turnover obligations.

“Export credit is around 6 per cent lower than the domestic rates and even after the expenses on minimal value addition and shipping, these exporters are able to make savings of 4 per cent by importing gold and exporting crude articles,’ he said.

Tags: diwali, gems and jewellery exports