สรุปข่าวเศรษฐกิจอินเดียประจำวันที่ 18 กันยายน 2556

Gold duty hiked again, this time for jewellery

The government on Tuesday raised the import duty on gold jewellery to 15%, introducing a 5% tariff differential with raw gold. The move, which underlined the government's persistent efforts to dampen the demand for gold imports and stabilise the rupee, will also give some comfort to the domestic jewellery industry with a decisive export orientation. The finance ministry's decision came close on the heels of the Reserve Bank of India (RBI) tightening norms for gold loan non-banking financial companies (NBFCs) on Monday, a step towards making gold more illiquid and taking away its lure as a hedge against adversity. The government hardened a crackdown on gold imports since June this year after imports in the first two months of the fiscal exceeded a record 300 tonnes, worsening fears of a runaway current account deficit. That has had the desired effect on imports, which saw 95% slump in August. Gold imports accounted for a record 61% of the CAD last fiscal. The plan is to reduce the CAD from $88 billion, or 4.8% of the gross domestic product (GDP), last fiscal to $70 billion, or 3.8% of the GDP, in 2013-14. Compounding the government's worry, the rupee has depreciated by roughly 20% so far this fiscal. Although jewellery made up for less than 1% of overall gold imports this fiscal, some bullion industry executives said in the absence of a duty differential, imports were gradually picking up. India imported gold jewellery worth $137.57 million in the first four months of this fiscal, compared with total gold imports of $18.52 billion. The country hardly imported any gold jewellery before January 2012 as the duty differential was to the tune of 8%.

(Source: Financial Express)

Import duty on gold jewellery increased to 15%

In a move aimed at protecting the domestic jewellery industry, the Centre on Tuesday increased the Customs duty on gold and silver jewellery by five percentage points to 15 per cent. Traders had been exploring the possibility of importing jewellery, especially gold, as it is hassle-free and does not attract the Reserve Bank of India’s 80:20 norms, under which 20 per cent of imported gold has to be re-exported. There also was a plan to import only crude jewellery, manufacturing cost of which is hardly one per cent, to avoid the 80:20 rule. The traders were exploring imports from Singapore and Dubai.

The Govt’s decision to raise Customs duty on gold jewellery to 15% would:

Plug Loophole:By importing gold jewellery, instead of gold, traders could have avoided RBI’s 80:20 norms, under which 20 per cent of imported gold has to be re-exported.

Help Domestic Industry:Imported jewellery — mostly machine-made and cheaper because of lower labour cost — could have been hurting Indian jewellery makers’ business.

(Source: Business Standard)

NRIs and foreigners can’t leave the country with rupee

Thanks to a new directive from the Reserve Bank of India (RBI), from now on every non-resident Indian ( NRI) and foreigner leaving the country will have to compulsorily change Indian rupees in their possession into a foreign currency before they board the flight.  It's a common practice among NRIs to carry some amount of Indian currency with them when they leave the country, mainly for the convenience of not having to exchange forex into rupee when they return the next time. But from now on, they will not be allowed to carry any Indian notes with them.  Although the rule, which is part of Foreign Exchange Management Act (FEMA), has been in place for quite sometime now, it is only now that the central bank is trying to enforce it. On Monday, RBI allowed forex changers to open kiosks beyond the immigration desks at international airports to facilitate NRIs and foreigners opting to exchange rupee for other currencies before they enter the aircraft. According to RBI officials, in case these travellers have Indian currency notes in their possession before boarding the flight, Indian customs officials can act against them. RBI has allowed NRIs to carry up to Rs 10,000 beyond the immigration and customs desks, and to the duty-free shopping and security checking areas in the departure hall in international airports to meet miscellaneous expenses.

(Source: Economic Times)

Shale gas exploration likely for only government firms initially

In a major setback to private sector majors preparing to bid for a piece of the country’s shale gas reserves, the petroleum ministry is thinking of initial allotment of nomination blocks (allotted to state firms before competitive bids were allowed) to only government companies. A senior petroleum ministry official said: “During the initial stage, we are planning to give the rights to state-run companies only. Those which have NELP blocks (given after bids under the New Exploration Licensing Policy) would have to go for the bidding round after that. This would help us to prove the potential. Otherwise, the policy would affect government’s profit-petroleum (the part of output which in the production sharing contract is not used to recover the company’s costs but is meant to be split with the government, the latter taking the bulk). In nomination blocks, this would be less, as expenses would be lower.” Shale gas refers to natural gas trapped within shale formations below the earth’s surface. The government is planning to put at least 100 blocks for bidding in Cambay, Krishna-Godavari and Raniganj.

(Source: Business Standard)

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