Urge govt to cut duty on scrap gold: Shree Ganesh Jewellery

June 12, 2014 Posted by admin

In an interview to CNBC-TV18, Nilesh Parikh, chairman of  Shree Ganesh Jewellery spoke about the latest happenings in the company and his outlook.

Below is a verbatim transcript of the interview  

Reema: We have seen gold imports come down and yesterday our trade secretary also indicated that he will be speaking to the finance ministry for rationalising a couple of the curbs on gold. If it comes through bit by bit, how much of a positive will it be?

A: The whole aspect of gold duty coming down will directly help the manufacturing sector of gold jewellery. The reason is that that because of the hike in the duty the manufacturing sector in India took a bit hit and with reduction of the duty the import of gold jewellery from abroad will stop and we will be again competitive as far as Indian markets go.

The second thing that they have allowed a relaxation that the premier and the star trading house other than the banks can import gold also—that would also help the manufacturers to get gold, bullion with ‘A’. So, these are two very important things that will help manufacturing sector directly increasing the employment which was reduced in last 8 months.

Ekta: We do understand that last year the company had to cancel and import deal with subsidiary which is based in UAE and that was worth around Rs 1,000 crore and impacted your numbers as well. Can you give us a sense on how your subsidiaries are doing which were dependent on this sort of a model or the import model and in terms of your raw material procurement what is the cost that you are currently procuring on the same?

A: Domestically, we are unable to procure gold at the moment because of the restriction that was imposed that star trading house or premier trading house other than the banks cannot import gold. Since that is withdrawn we would be able to import gold under 80:20 scheme now directly.

We have got our license for premier trading house; it’s recognition of Government of India which has been issued couple of days back and now we will get back to our manufacturing and we will get the things in the right direction.

So, that will help the company to start manufacturing because we have a very large facility in Bengal which could employee approximately 2,000-3,000 people—that was the original plan.

We also have a refinery. So, our request to the government was to reduce the duty on scrap gold, which is 25 percent. Due to this, the other countries like South East Asian countries and Middle East countries’ refineries and their businesses are thriving.

Article source: http://www.moneycontrol.com/news/business/urge-govt-to-cut-dutyscrap-gold-shree-ganesh-jewellery_1103507.html

Leave a Reply

Your email address will not be published. Required fields are marked *