India to ask gold traders to produce payment proof for jewellery exports

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In a bid to tighten gold supplies to India, the country is considering asking gold traders to produce a proof of payment for their jewellery exports.

According to the media reports, earlier last month, the central bank made it compulsory for importers to export 20 per cent of their goods to curb gold supplies into the country and help reduce its trade deficit.

As a result, fresh supplies dried up as importing agencies were awaiting the final operational guidelines from the customs department, said report.

"Before importing the third lot, they will have to give proof of exports, not by showing custom attested invoice or shipping bill, but inward remittance of payment for the first (lot)... ," said Pankaj Kumar Parekh, vice-chairman of GJEPC.

The whole procedure would take nine months and until that point, new gold shipments cannot come in, even for export, said Parekh, adding that the GJEPC was talking to the authorities to convey its reservations about the guidelines.

Currently, jewellery exporters have up to 90 days to ship out from the date of import, and 180 days to receive payment from overseas buyers.

Dion Global Solutions Ltd.

Read more about: gold, gold exports, traders, trade deficit
Story first published: Tuesday, August 27, 2013, 9:20 [IST]
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