The scheme aims to support MSME diamond exporters, generate employment, safeguard domestic industry and enhance global competitiveness through facilitating ease of doing business in India’s diamond sector.
Diamond Imprest Authorization (DIA) Scheme
Key Statistics (Global Trade Research Initiative)
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- It has been introduced under Foreign Trade Policy 2023.
- Objective: Provide streamlined mechanism for duty free import of Natural Cut and Polished Diamonds.
- Key Features:-
- This scheme allows the duty-free import of Natural Cut and Polished Diamonds, of less than ¼ Carat (25 Cents).
- Export Obligation: It mandates export obligation with a value addition of 10%.
- Eligibility: All Diamond exporters holding Two Star Export House status and above and having US $15 Million exports per year.
- Non-Applicability: The scheme does not apply to Lab-Grown Diamonds (LGDs).
- Duties Exempted: Basic Customs Duty, Additional Customs Duty, Education Cess, Anti- dumping Duty, Countervailing Duty, others.
In recent times, the diamond industry is witnessing multiple global and internal challenges leading to a steep decline in exports and job losses for the workers.
Challenges faced by Diamond Industry
- Global: Sharp drop in Demand for polished diamonds in US, China and Europe, Shifting consumer Preferences towards lab-grown diamonds
- Internal: large unsold inventories of polished diamonds, Rising operational costs, reduced margins in global diamond trade, India’s high corporate tax regime and reduced credit from banks
Way Forward
- Extension of export credit period for cut and polished diamond exporters, Exemption of Foreign Rough Diamond Sellers from Corporate Tax, Proper regulation of Lab-Grown Diamond Industry
