India has implemented tighter controls on gold imports to stem alleged abuse by certain importers taking advantage of trade loopholes. The action follows increasing concerns regarding irregularities in documentation and evasion of duties, driving the Indian government to act promptly to tighten regulations.
In spite of the crackdown, UAE jewellers are hopeful, holding onto the India-UAE Comprehensive Economic Partnership Agreement (CEPA) as a sound foundation assuring continued trade. Under CEPA, UAE gold imports still receive preferential tariffs, keeping the precious metal flow stable and well-regulated.
Industry sources in the UAE indicate the new Indian steps are aimed at abuse, not at legitimate trade, and will more than likely enhance transparency as well as enhance confidence in the two-way commerce. “This will eliminate grey channels and reinforce compliant business,” is what a Dubai-based bullion dealer replied.
With India among the world’s largest consumers of gold, and the UAE one of its major suppliers, the long-term alliance between both nations seems intact. Jewellers are now compelling importers to strictly follow CEPA procedures to avoid disruption and ensure confidence on both sides.
