Key Highlights
- Gold: Drawback cut 3.1% from ₹1,851.99 to ₹1,794.11 per gram.
- Silver: Cut nearly 9% from ₹29,501.09 to ₹26,859.02 per kg.
- What it means: Smaller refunds for exporters, which could squeeze margins.
- Still higher than before July: Gold drawback remains more than double its pre-July level.
- Industry view: Experts say strong global demand could limit the impact.
The Finance Ministry has reduced duty drawback rates on exports of gold and silver jewellery and other precious metal products, according to a government notification issued on Friday.
The New Rates
| Product | Old rate | New rate | Change |
|---|---|---|---|
| Gold jewellery | ₹1,851.99/gram | ₹1,794.11/gram | −₹57.88 (−3.1%) |
| Silver jewellery and products | ₹29,501.09/kg | ₹26,859.02/kg | −₹2,642.07 (−9%) |
What Is Duty Drawback?
Duty drawback is a refund that exporters receive for customs and other duties paid on raw materials or inputs used to make goods that are exported. It helps keep Indian exports competitive by removing the burden of domestic duties from goods sold abroad.
Why It Matters: A Partial Reversal, Not a Full One
The cut comes just three months after the government sharply raised drawback rates in July to help exporters cope with rising costs and global uncertainty. Even after Friday’s reduction, the rates remain much higher than before July.
| Product | Before July | After July hike | Now |
|---|---|---|---|
| Gold (per gram) | ₹773.17 | ₹1,851.99 | ₹1,794.11 |
| Silver (per kg) | ₹14,990.66 | ₹29,501.09 | ₹26,859.02 |
In other words, the gold drawback is still more than double, and silver about 1.8 times, what it was before July. Exporters lose part of the July relief, but not most of it.
The notification did not spell out the reason. Such rates are typically reviewed from time to time in line with changes in metal prices and duties.
What It Means for Jaipur and Other Hubs
India’s jewellery export industry is spread across hubs such as Mumbai, Surat and Jaipur, which is known for its gold, silver and gemstone jewellery. For exporters here, especially in silver, where the cut is steeper, refunds on each consignment will now be smaller, putting some pressure on margins.
Industry experts, however, believe that if global demand stays strong, the overall impact on exports may be limited.
The government has clawed back a small part of July’s generous relief for jewellery exporters. Silver exporters feel it more, but with rates still far above pre-July levels, the sector retains much of its support.
With inputs from IANS.